Singapore’s industrial production (IP) remained steady in June, marking an 8% year-on-year increase, according to a report by UOB Global Economics and Markets Research. This growth comes despite a flat month-on-month seasonally adjusted performance, following a revised 1% increase in May. The report highlights that the overall manufacturing growth for the first half of 2025 is expected to maintain a 5% year-on-year increase, aligning with advance estimates.
Pharmaceuticals played a significant role in this growth, with output surging by 43.7% in June, up from 14% in May. This spike is attributed to potential front-loading ahead of anticipated US tariffs on pharmaceutical imports. However, excluding biomedical output, industrial production contracted by 0.8% month-on-month in June.
The electronics sector faced challenges, with a 1.6% month-on-month decline in June, continuing a downward trend from May. The sector’s performance was particularly impacted by weaknesses in semiconductors. Conversely, precision engineering showed promise, with a 15.3% month-on-month increase, driven by machinery, systems, and precision modules.
UOB’s report also noted that Singapore’s GDP growth of 4.2% year-on-year in the first half of 2025 was bolstered by export front-loading and manufacturing activities, anticipating further US tariffs. However, the report warns of potential growth weakening in the second half of the year due to these tariffs, which could affect trade-related services more than manufacturing.
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