Factory activity edges up in Dec, supported by electronics demand

Singapore’s manufacturing output edged up in December, pointing to a positive outlook for the sector going into 2026.

- Sue-Ann Tan Business Correspondent

This also marks the fifth consecutive month of expansion for the overall manufacturing sector, according to data released on Jan 2 by the Singapore Institute of Purchasing and Materials Management (SIPMM), which compiles the monthly survey.

The December reading of the Singapore Purchasing Managers' Index (PMI) came in at 50.3, up 0.1 point from the previous month, indicating a slightly faster pace of expansion.

The index is a barometer of the overall manufacturing industry’s health. A PMI reading above 50 indicates growth; one below suggests a contraction in output.

Singapore's strong PMI readings follow the trend in the region.

Taiwan and South Korea led a rebound in Asia’s manufacturing activity, with firms heading into 2026 with optimism that global demand is weathering US President Donald Trump's war on free trade, Reuters and Bloomberg reported.

China’s data readings also showed an unexpected turnaround in factory activity in the world’s second-largest economy, helped by a pre-holiday surge in orders, they noted.

Singapore’s latest performance was driven by stronger growth in new orders and factory output, said SIPMM.

However, slower rates of expansion were recorded for the indexes of new exports and input purchases. Meanwhile, the employment index still contracted, although at a slower rate.

Slower expansion rates were also recorded for the indexes of finished goods, imports and input prices, while the order backlog index posted a faster rate of contraction.

The future business index remained in expansion for the second consecutive month.