Singapore: PMI points to transitory weakness – UOB
UOB economist Jester Koh highlights that Singapore’s electronics PMI rose in August, with broad-based gains in new export orders, output and backlogs.
Singapore's PMI indicates temporary softness in the electronics sector, according to UOB economist Jester Koh. The August electronics PMI rose to 52.6, reflecting improvements in new export orders, output, input purchases, and order backlogs. These gains suggest that recent weakness in electronics NODX and IP likely stems from capacity constraints rather than weakening end demand.
The decline in finished goods inventory stocks indicates firms are drawing down existing inventories to meet rising demand, which should support electronics IP in the coming months. The re-escalation of the Middle East conflict has caused a deterioration in supplier deliveries and increased input prices, particularly in energy costs, due to tech-flation pressures from the global chip shortage.
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