Singapore July PMI at 1-year peak as electronics orders surge
SINGAPORE Aug 4 (Reuters) - Singapore's manufacturing activity expanded in July at its fastest rate in a year as orders in the key electronics sector surged, a survey showed on Monday, adding to evidence that factory activity across Asia picked up last month.
The Singapore Institute of Purchasing & Materials Management's Purchasing Managers' index (PMI) rose to 51.5 in July, the highest since July 2013. That compared with 50.5 in June.
The July PMI for Singapore's electronics sector jumped to 52.4, also the highest since April 2011, according to an official at the institute. In June, the sector's PMI was 50.7.
A reading above 50 indicates that activity is generally expanding, while one below that points to a contraction.
"The increase in the overall PMI was attributed to higher new orders and new export orders as well as higher level in production output and inventory," the institute said in a statement.
The higher electronics sector PMI indicated growth in new orders from both domestic and overseas markets, it added.
The sector had been hurting the city-state's exports and industrial output as it is not well-placed enough in the global electronics chain to benefit from growth in smartphones and other highly popular hi-tech products.
The government's push to reduce a politically unpopular reliance on foreign workers in a bid to increase productivity has led to a tight labour market and put upward pressure on wages. That raised business costs and cut competitiveness in Singapore's manufacturing sectors, including the electronics.
Strong readings in Singapore's PMI in July came as manufacturing activity in most of Asia expanded, possibly signalling the start of a long-awaited pick up in global trade. China's factories posted their strongest growth in at least 1-1/2 years.
(Reporting by Jongwoo Cheon; Editing by Kim Coghill)