Tuesday June 03, 2008

Singapore industrial production unexpectedly dropped in Apr 2008 on drugs, electronics

This article belongs to the Singapore stagflation watch story arc.

bloomberg.com :

Singapore's industrial production unexpectedly declined in April [2008], the biggest drop in 10 months, as drug companies and electronic manufacturers reduced output. Manufacturing, which accounts for a quarter of Singapore's economy, fell 5.7% from a year earlier, following a revised 18.1% gain in March, the Economic Development Board said today [26 May 2008]. Analysts [had] predicted a 6% increase.

Economists have warned that manufacturers in Singapore and across Asia face easing demand amid signs of a slowdown in the US, the region's largest export market. Electronics production dropped 5.1% last month from a year earlier. The island's electronic exports have declined for 15 months. Computer chip production in Singapore fell 7.4% in April from a year ago.

- So the economists got their manufacturing growth forecasts almost right. They just got the sign wrong, the actual figure being a negative 5.7% instead of a positive 6%. This is not the first time they got surprised either. They have been building up an impressive track record of being continually surprised by a shrinking Singapore economy.

Meanwhile, Singapore's inflation rages on with a 7.5% CPI inflation rate, the fastest in 26 years. Now that's stagflation for you - the classic scenario of increasing inflation in an environment of stagnant or slowing economic growth. If someone had told you earlier that stagflation is an unlikely scenario, you can tell them that they are wrong because we are living in stagflationary times right now.

See also :

1. Singapore GDP unexpectedly shrinks on weaker output
2. Singapore economy shrinks first time since 2003
3. Singapore economy stuck in mud : inflation rising, M3 falling, GDP crashing - the stagflation formula
4. Singapore 2007Q4 GDP contracted 4.8%, 2008 economic growth forecast lowered
5. Singapore inflation rate hits new 26-year high of 7.5% in Apr 2008
6. Singapore hyperinflation warning signs #2 : Cooking oil price up 75%

(2008-06-03 00:29:31 SGT) [Biz] Permalink

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