Source : TODAY, Wednesday, September 5, 2007
TREMORS in the US sub-prime mortgage market may have started to hurt Singapore’s export sector.
The latest Purchasing Managers’ Index (PMI), a key gauge of the manufacturing sector, fell 1.6 points from the previous month to 51.7 points in August, because of a fall in the manufacturing and electronics new orders and new export orders.
“Our anecdotal evidence suggested that the tremors in the US sub-prime mortgage market and lower consumer demands have hit the health of the US economy, resulting in a fall in Singapore’s exports to this biggest customer,” said Ms Janice Ong, executive director of the Singapore Institute of Purchasing & Materials Management, which released the data.
Despite the slower growth, she said “it is reassuring that the manufacturing economy continues to remain in the expansion track, indicating a positive business environment”.
An index reading below 50 indicates contraction in factory activity, while one above 50 shows expansion.
She added that regional markets such as China and India continue to provide the business volume for the index to remain above 50. Employment index for manufacturing and the electronics sector also posted higher readings compared to previous month. Ms Ong expects September’s PMI reading to improve marginally over that of August if the business outlook in the overseas market improves and employment level stabilises. — CHEOW XINYI
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