Singapore manufacturers' confidence fell to 12% in the second quarter, with chemicals at minus 25 on West Asia feedstock disruption

Statistics Singapore reported on Friday, 31 July 2026, that business confidence in the country's manufacturing sector remained positive in the second quarter of 2026 with a net weighted balance of 12%, though down from 17% in the previous survey. The agency said strong global AI related demand continues to support sentiment despite elevated geopolitical and economic uncertainty.

The sector breakdown shows a clear split. Precision engineering was the most optimistic at plus 55, driven by semiconductor related equipment demand, and electronics also stayed upbeat at plus 19 on robust AI related semiconductor demand. By contrast chemicals was the weakest at minus 25, attributed to West Asia related feedstock supply disruptions. General manufacturing industries stayed cautious at minus 13 because of rising material, fuel and freight costs.

For the third quarter, a net 26% of firms expect output to increase, led by precision engineering, electronics and transport engineering, and most manufacturers anticipate stable employment. Singapore is one of Asia's refining and petrochemical hubs and a leading indicator of world trade, and the negative reading for its chemicals sector is one of the measurable channels through which the West Asia energy disruption is feeding into Asia's industrial supply chain.