Thursday, 21 October 2004

Singapore's manufacturers report poorer outlook

The outlook for Singapore's manufacturers appears to have turned poorer. Excerpt of the news report:

Rising oil prices dampen Singapore manufacturers' business outlook
Rising oil prices have taken a toll on Singapore manufacturers’ business sentiment, according to the latest survey by the Singapore Manufacturers’ Federation (SMa). The survey, carried out in September 2004, showed that Singapore manufacturing companies are less positive about business prospects in the next few months because of the threat of higher oil and raw material prices.

While most manufacturing firms here expect to stay profitable in the months ahead, more are now expecting business conditions to worsen.

According to the SMa, some 22% of survey respondents felt their businesses would deteriorate in the final months of the year, compared with 11% who felt so in the previous survey... And in anticipation of the leaner times ahead, fuelled by a slowdown in export orders, manufacturers are becoming more reluctant to hire more staff, the SMa said.

On Monday, International Enterprise Singapore had released a report showing that Singapore's non-oil domestic exports for September declined 1.4 percent compared to the previous month on a seasonally-adjusted basis. Year-on-year, though, it was up 16.9 percent, higher than most economists had expected.

What is of concern, though, was that non-oil retained imports of intermediate goods, a short term leading indicator of manufacturing activity, declined 7.2 percent on a month-on-month seasonally-adjusted basis. This is consistent with the SMa survey result indicating a weaker outlook for Singapore's manufacturing.

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