SINGAPORE (Reuters) - Singapore’s industrial production remained on a roll in August, rising more than expected due to growth in electronics and biomedical output, data showed on Tuesday.
Manufacturing output in August rose 19.1 percent from a year earlier, data from the Singapore Economic Development Board showed. The median forecast in a Reuters survey was for a 14.2 percent expansion.
On a month-on-month and seasonally adjusted basis, industrial production rose 0.6 percent in August, higher than the median forecast for a contraction of 0.4 percent.
Manufacturing output of electronics rose 38.7 percent in August from a year ago after growing 49.4 percent in July.
“This shows that it (electronics sector) still has legs,” said ANZ Bank economist Weiwen Ng, adding that the growth in electronics output was “homogenous and largely driven by production of semiconductors”.
However, the rally does not seem to be ending soon thanks to the growth of “digitisation” and launches of new phone models, said Ng.
In July, manufacturing output rose at its fastest pace in seven months, at a revised 21.2 percent from a year ago, due to higher output of electronics and precision engineering. On a month-on-month, seasonally adjusted basis, it grew at a revised 0.9 percent.
Singapore and other Asian economies that are highly dependent on trade have gained a lot this year from an improvement in global demand, particularly for electronics products and components such as semiconductors.
Singapore’s advance estimate of third-quarter gross domestic product and the central bank’s twice-yearly monetary policy decision, are both due to be announced in October.
Earlier this month, economists raised their forecasts for the city-state’s economic growth in the third quarter, a central bank survey showed, with manufacturing activity likely to remain solid after a strong first half.
“Third quarter (GDP growth) is likely to surprise positively on the upside,” Ng said.
The prevailing expectation among analysts has been that the Monetary Authority of Singapore will keep its exchange-rate based policy settings unchanged in October since there has been little sign of any broad pick-up in demand-led inflationary pressures despite improved growth prospects this year.
“However, the tone of the statement may be slightly positive in light of the improving external backdrop,” Ng added.
Reporting by Fathin Ungku; Editing by Subhranshu Sahu