IPI Slowed In April, Dragged By Pharmaceuticals

Economic Research			29 May 2017
Singapore
Economic Update
IPI Slowed In April, Dragged By Pharmaceuticals Singapore’s IPI growth decelerated to 6.7% YoY in April, driven by a sharp plunge in output from the biomedical manufacturing and domestic oriented industries. Meanwhile, production of electronics picked up, cushioning some of the downside. Excluding biomedical manufacturing, the IPI expanded 15.5% YoY in April, picking up from a 13.5% rise the month before. The slowdown is not alarming as the IPI had been expanding strongly since late last year, and the low base effect has faded. We maintain our forecast for manufacturing output to grow 4% in 2017, compared to +3.6% last year, underpinned by:     i.   Overall higher semiconductor production: demand is set to pick up again in 2H ahead of the new iPhone launch;    ii.   Firming US economic growth and the receding risk of an EU break-up, which is set to reignite the global capex cycle – which would support machinery exports;   iii.   An improving global outlook, which would also lead to rising demand for petrochemicals and oil & gas production. Economist:  Ng Kee Chou | +603 92802179
To access our recent reports please click on the links below: 26 May  2017: GDP Strong In 1Q But Set To Moderate 24 May  2017: Cost-push Factors Drive Core CPI Higher 18 May  2017: NODX To Moderate From 1Q As Base Effects Normalise 2 May  2017: Rise In Loans Heralds Firming Economic Recovery 27 April  2017: IPI Continues To Ride The Export Wave 25 April  2017: CPI Rise On External Pressures; Sentiment Picking Up
Economics Team
Lim Chee Sing	Chief Economist	cslim@rhbgroup.com		+603 9280 2153
Peck Boon Soon	Chief ASEAN Economist	bspeck@rhbgroup.com		+603 9280 2163
Vincent Loo Yeong Hong	Malaysia, Vietnam	vincent.loo@rhgroup.com		+603 9280 2172
Ng Kee Chou	Singapore, Thailand	ng.kee.chou@rhbgroup.com		+603 9280 2179
Zhang Fan	China	zhang.fan@rhbgroup.com		+8621 6288 9611
Rizki Fajar	Indonesia, Philippines	rizki.fajar@rhbgroup.com		+6221 2970 7065
Aris Nazman Maslan	Malaysia, Vietnam	mohd.aris.nazman@rhbgroup.com		+603 9280 2184

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