Singapore's production surges as drug, electronics output climbs

Singapore’s industrial output grew at the fastest pace in four months as manufacturers produced more pharmaceuticals and computer parts, bolstering an economic expansion that has allowed the central bank to tighten policy.

Manufacturing, which accounts for about a quarter of the economy, climbed 22% in March from a year earlier after a revised 4.7% increase in February, the Economic Development Board said in a statement today. The median estimate of 13 economists surveyed by Bloomberg News was for a 23.8% gain.

Manufacturing and services, aided by rising exports, drove a strengthening in Singapore’s economy last quarter and the government predicts overseas shipments may rise as much as 10% this year. Intel Corp. and Micron Technology Inc. opened a US$3 billion ($3.71 billion) factory in Singapore this month and said the venture will reach full production later this year.

 

“Production remains on a moderate upward trajectory, supported by non-oil domestic exports,” David Cohen, a Singapore-based economist at Action Economics, said before the report.

 

Singapore’s dollar has risen to records after the central bank said April 14 it would allow further appreciation in its third tightening of monetary policy in a year. The currency traded at $1.2375 against the U.S. dollar as of 12:55 p.m. local time today. The island uses the exchange rate as its main tool to manage inflation.

 

Production in the first quarter rose 13.1%, less than the government’s April 14 preliminary estimate of 13.9%.

 

Industrial production advanced a seasonally adjusted 22% in March from February, when it dropped 2% from the previous month, today’s report showed.

 

Electronics production increased 6.9% from a year earlier after rising a revised 9% in February. Pharmaceutical output surged 60.9%.