Sharpest manufacturing plunge in over two years points to weak Q2 GDP

IT WOULD be easy to blame April's 8.7 per cent plunge in industrial output - the steepest year-on-year decline in more than two years - on the volatile pharmaceuticals sector's 38 per cent contraction.

But economists say that weakness showed up in other manufacturing clusters too, confirming what April's purchasing managers' index (PMI) had suggested: Singapore's economy has had a weak start in Q2. Some now believe that GDP for the current quarter could shrink from Q1's levels - which were revised higher on Tuesday.

Lower production of active pharmaceutical ingredients and biological products led the pharma segment to shed close to two-fifths of last April's high output base; this outweighed the medical technology segment's robust 28.1 per cent growth and dragged overall output from the biomedical cluster 28.6 per cent lower year-on-year.