Chart of the Day: Manufacturing output down 0.4% in July

The precision engineering cluster fell sharply by 7.5%.

This chart from UOB citing data from the Economic Development Board shows that Singapore’s industrial production dipped 0.4% YoY in July, but expanded 3.6% MoM.

Excluding biomedical manufacturing, manufacturing output rose 9.4% MoM but down 0.7% YoY.

“In a nutshell, the better-than-expected industrial production growth pace in July reinforces our view for Singapore to evade a technical recession scenario in 3Q19,” Barnabas Gan, economist at UOB said in a note.

Also read: Technical recession risks heighten over dismal GDP growth

Amongst clusters that witnessed positive gains in July, general manufacturing output led the growth as it climbed 6.9% YoY, its fastest pace of growth since January 2018. This is followed by chemicals output which edged up 2.2% YoY and biomedical manufacturing which expanded for the tenth consecutive month by 0.8% YoY.

On the other hand, precision engineering fell 7.5% YoY in June. Electronics and the transport engineering clusters slipped 0.9% and 0.2% YoY, respectively. In addition, production of semiconductors was flat at 0.3% YoY in July, as compared to the 7.3% YoY in the same period in 2018. Overall, the precision engineering and electronics clusters fell 8.7% and 5.6% respectively in the first seven months of 2019.

“All-in-all, we keep our industrial production growth outlook to see some stabilisation in 3Q19 and a small pick-up in 4Q19, thus averaging -1.0% y/y in 2019,” added Gan.