SINGAPORE: Singapore’s manufacturing contracted further in August, with the Purchasing Managers’ Index (PMI) dropping to 49.3, down from 49.7 in the previous month, said the Singapore Institute of Purchasing & Materials Management here the other day.
This is the second consecutive month of contraction, and the drop is mainly due to further drop in new orders, new export orders, production output as well as input prices. A reading above 50 in the PMI indicates an expansion in the manufacturing sector, whereas a reading below 50 suggests contraction.
The PMI in the electronics sector also dipped to 49 in July. Some economists say that Singapore’s weak PMI readings are consistent with weak manufacturing data coming out of China, South Korea, Malaysia and Indonesia.
China’s manufacturing PMI fell to the lowest level in three years at 49.7 in August, while Japan and China’s Taiwan also registered fall in their PMI readings.
According to Channel NewsAsia, the weak readings increased the possibility that Singapore could slip into a technical recession during the third quarter, if services also falter amid the uncertainties in China.
