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Singapore business conditions healthy for 7th straight month in December

Wednesday, January 6, 2016 - 10:44
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BUSINESS conditions have remained healthy for the past seven months, based on the latest Nikkei Singapore Purchasing Managers' Index (PMI).

BUSINESS conditions have remained healthy for the past seven months, based on the latest Nikkei Singapore Purchasing Managers' Index (PMI).

This is despite rising costs for businesses here and stagnating new businesses and export orders.

The Nikkei PMI for December was at 52.1, remaining relatively unchanged from November's 52.2 reading.

Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration.

Latest data signalled a further rise in Singaporean private-sector output in December, though the rate of expansion slowed slightly since the previous month.

Though conditions have remained benign for the past seven months, sentiment was still weak.

Markit, the financial information services provider which compiled the survey that sought inputs over 400 private-sector companies across the Singapore economy, noted that cost burdens increased at the quickest rate in 11 months, driven by faster rises in both purchasing prices and staffing costs.

Companies only passed on part of their higher cost burdens, however, and raised their selling prices marginally.

Total new work broadly for companies was also stagnating in December, while new export orders rose at a weaker pace.

"This suggests growth projections for the start of 2016 remain muted, as companies await a much needed pick-up in client demand," said Markit economist Annabel Fiddes.

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