Manufacturing momentum eases in March but PMI still signals expansion

SIPMM notes positive outlook despite slower expansion and geopolitical uncertainties, led by electronics sector demand.

Singapore’s manufacturing sector expanded for the eighth consecutive month in March, with the Purchasing Managers’ Index (PMI) at 50.5, down 0.1 point from February, according to the latest data from the Singapore Institute of Purchasing and Materials Management (SIPMM).

The moderation was attributed to slower expansion in new orders, new exports, factory output, and employment, however, the input purchases index recorded a faster rate of expansion, whilst the supplier deliveries index contracted at a faster pace for the third consecutive month, indicating longer delivery lead times.

Faster growth was recorded in finished goods, imports, input prices, order backlog, and future business with the order backlog index expanded for the third consecutive month, whilst the future business index remained in expansion for the fifth month, reflecting continued business optimism, according to the SIPMM report.

The electronics sector remained a key contributor to manufacturing expansion, supported by global demand for semiconductors, AI hardware, and data centre components, according to SIPMM executive director Stephen Poh.

He also noted that the positive state of the industry is welcome amidst the global situation, saying “It is encouraging to note that the latest PMI readings continue to reflect a positive outlook for the overall manufacturing sector, despite heightened geopolitical uncertainties arising from the US-Iran conflict.”