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SINGAPORE : Singapore's manufacturing economy contracted to a seven-year low in October.
The latest Purchasing Managers' Index (PMI) came in at a weaker-than-expected 45.8 points, down by 3.7 points from September.
A reading below 50 means the manufacturing economy is generally contracting.
This is the second straight month of contraction, and the index's worst performance since the September 11 terror attacks in the United States in 2001.
The contraction was due to a persistent fall in overall new orders and new export orders, as well as declining levels in production output and imports.
The reading for new export orders was 44.8, the lowest since the series of data began nine years ago. The production index of 45.4 is also the lowest seen since July 2001 when the dotcom bubble burst.
Some economists said the numbers suggest a global slowdown in manufacturing.
Song Seng Wun, CEO & regional economist, CIMB-GK Research, said: "If we look at the purchasing manager's numbers so far, be it US, Asia and now Singapore, we saw a sharp fall in production and a corresponding drop in orders as well.
"If orders are any guide, it suggests that manufacturing in subsequent months or more could be down. Therefore, we are seeing for first time since September 11 a synchronised slowdown in manufacturing."
However, economists also noted that the biomedical sector could provide some relief for Singapore.
"We do have one segment - the pharmaceutical sector - which was a significant drag on overall output in the third quarter and second quarter as well. If we look at the recent EDB (Economic Development Board) survey on manufacturing, in particular pharmaceuticals, the survey found some optimism of a rebound in output in the fourth quarter or first quarter next year," said Song.
Elsewhere, the electronics sector snapped four months of expansion to record an index reading of 49, down 4 points from a month ago and the lowest since June 2006. - CNA /ls
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