Industrial production dismayed everyone with 3.9% dip

When market was expecting 6.5% growth.

According to DBS, industrial production index for January surprised on the downside. The headline number turned in a disappointing 3.9% YoY rise against market expectation of a 6.5% expansion. In fact, the sequential slide was even more acute.

Output slipped by 8.1% MoM sa with pullbacks across all key clusters. The effect of the Lunar New Year has been sharper than expected. 

Here's more from DBS:

Such seasonal effect largely explains the sequential decline. The sharp moderation in electronics production is another piece of evidence suggesting seasonal factor at work.

Note China is an important export market for local electronics component manufacturers.

Plant shutdowns in China during the festive season typically will have significant impact on Singapore’s electronics export sales and production. Manufacturing figures in the near term will continue to be distorted by the season effect.

Data after February will provide more clarify on the outlook of the manufacturing sector, and to some extent, on the economy.