Singapore Factory Activity Hits 10-Month Growth Streak on AI Chip Demand

Singapore's manufacturing sector posted its tenth consecutive month of expansion in May, with the Purchasing Managers' Index climbing to 51 — its highest since December 2024. The Singapore Institute of Purchasing & Materials Management attributed the boost to sustained demand from the AI-driven technology cycle, with stronger new orders, exports, factory output, and employment across the board. SIPMM executive director Stephen Poh noted that higher input costs and slower supplier deliveries remain headwinds, but order backlogs and improving sentiment suggest cautious optimism among manufacturers.

Why it matters for Singapore: This isn't just a macro data point — it reflects how deeply the global AI hardware buildout is flowing through Singapore's economy. With semiconductor test, packaging, and precision component companies all benefitting from the AI chip cycle, the city-state's manufacturing sector is riding a wave that shows no signs of slowing.