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When will the manufacturing recession end?

February marked the fifth consecutive month of decline in industrial production. 

Experts remain downbeat on Singapore’s manufacturing output, following the “worse than forecast” February industrial production (IP) print.

In February, output dropped by 8.9% YoY and 11.7% MoM, marking the fifth consecutive month of YoY decline and the “worst streak since 2015,” according to Alvin Liew, UOB’s senior economist.

Given the Feb IP print, Liew said manufacturing output for 2023 will likely contract by 5.4%.

Liew cited “worsening electronics downcycle and weaker external demand” as factors affecting Singapore’s manufacturing output.

The manufacturing recession will likely persist in the first half of 2023, said Maybank analyst Chua Hak Bin; however, manufacturing may slowly recover from Q2 onwards as China’s reopening begins to have a more pronounced impact.

ING Senior Economist, Nicholas Mapa, echoed this, saying that the “reopening of China after an extended period of time could eventually jumpstart global demand, which, in turn, could be one factor that leads to a rebound in industrial production later in the year.”
 

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