Singapore Manufacturing PMI Dips into Contraction

Singapore’s Manufacturing PMI edged up to 50.6 in February 2026, the highest in nearly a year, from 50.5 in the prior month. Factory output and input purchases continued to expand, but at a slower pace, while the supplier deliveries index contracted for a second consecutive month, following a brief period of moderation, indicating longer lead times. Meanwhile, input prices, order backlogs, and future business expectations rose more quickly, despite slower import growth. The finished goods index returned to expansion, and the future business index remained positive for a fourth consecutive month, reflecting sustained business optimism. Within the electronics sector, which accounts for about 30% of the country's factory output, rose to 51.3 from 51.1 in January, driven by faster increases in new orders, exports, output, and employment.

Singapore’s Manufacturing PMI rose to 50.5 in January from December's 50.3, sustaining a six-month period of mild expansion. This was the highest reading since March last year, driven by increases in new orders, exports and output. Still, manufacturers continued to face capacity constraints and supply-chain disruptions. "Avoidance of the Red Sea and Suez Canal routes has lengthened transit times and slowed turnaround schedules", said SIPMM executive director Stephen Poh. The PMI for electronics, which accounts for about one third of the country's output, rose to 51.1 from 50.9 in December, as ongoing strong demand for AI-related memory chips boosted new orders, exports, output, input purchases and employment.

Singapore’s Manufacturing PMI edged up 0.1 point to 50.3 in December from 50.2 in November, marking the fifth consecutive month above the 50-point threshold and the highest reading since March 2025, signaling a modest but sustained expansion in manufacturing activity. The increase was supported by stronger new orders and factory output. The electronics sector, which accounts for roughly a third of manufacturing activity, remained the strongest performer, with its PMI climbing to 50.9 for the seventh straight month, underpinned by robust AI-related server demand and US tariff exemptions on electronics goods. However, broader manufacturing momentum showed signs of slowing, with weaker growth in new export orders and input purchases, while employment conditions remained subdued, highlighting a divergence with the electronics segment. Looking ahead, the electronics upcycle may face 2026 headwinds from US semiconductor tariffs, softer AI demand, and capacity and logistics constraints.