Singapore Market Week Ahead: May Inflation, Industrial Production, and PPI

June 24, 2024

As markets brace for the week ahead, Singapore’s economic pulse will be monitored closely with the release of critical data points including May’s inflation figures, industrial production trends, and the producer price index (PPI). Investors will also keep an eye on key economic reports expected from the United States and China, which will provide insights into global economic health amidst ongoing uncertainties.

Singapore: Inflation, Industrial Production, and PPI

In Singapore, May’s inflation data is highly anticipated. April 2024’s annual inflation rate stood at 2.7%, slightly above market expectations of 2.6%, marking the lowest rate since September 2021. Core consumer prices remained steady at 3.1%, aligning with market estimates. These figures help understand underlying inflation trends and the effectiveness of current monetary policies.

The May industrial production data is also crucial. April 2024 saw a 1.6% year-on-year (y-o-y) decline in manufacturing production, softer than the previous month’s 9.2% fall but contrary to the forecasted 0.2% gain. This underperformance highlights challenges in the manufacturing sector, possibly due to global supply chain disruptions.

Additionally, the PPI for May is set to be released. The Domestic Supply Price Index decreased by 0.1% y-o-y in April 2024, marking the fourth consecutive month of decline, though it was the smallest in this sequence. PPI trends indicate cost pressures within the economy and can be a precursor to future consumer inflation.

United States: PCE Inflation, Personal Income, and Spending

In the United States, the May Personal Consumption Expenditures (PCE) inflation data will be closely watched. The PCE price index is the Federal Reserve’s (Fed) preferred measure of inflation, and a soft reading is expected, continuing the disinflationary trend. This could influence the Fed’s future interest rate decisions.

Reports on personal income and spending for May will provide insights into US consumer behavior. Weaker retail sales data from the previous week suggest that spending data might be soft. Other key releases include the final reading of Q1 gross domestic product (GDP) growth and durable goods orders for May, offering a comprehensive view of the economic performance.

China: Industrial Profits and NBS Manufacturing PMI

In China, the release of May’s industrial profits is anticipated. Previously, profits rose by 4.3% y-o-y to CNY 2,094.69 billion in the first four months of 2024, maintaining the same pace as before. This steady growth highlights efforts to sustain economic recovery amid challenges like weak domestic demand and deflation risks.

The National Bureau of Statistics (NBS) Manufacturing Purchasing Manager Index (PMI) for June is also due. In May 2024, the PMI unexpectedly declined to 49.5 from 50.4 in April, indicating the first contraction in factory activity since February. The upcoming PMI release will be critical for assessing the current state of manufacturing and business conditions in China.

The upcoming economic releases for Singapore, the United States, and China will be pivotal in shaping the market outlook. In Singapore, inflation, industrial production, and PPI data will provide insights into domestic economic conditions. In the United States, PCE inflation, personal income and spending data, along with GDP and durable goods orders, will offer a comprehensive view of economic health. In China, industrial profits and PMI figures will shed light on recovery efforts and challenges. Collectively, these data points will be instrumental in understanding the global economic landscape in the week ahead.

Disclaimer: ProsperUs Manager of Content Hailey Chung doesn’t own shares of any mentioned companies.


Hailey Chung

As a lifelong learner, Hailey strives to simplify finance for everyday investors, making it relatable and enjoyable. She desires to support investors with various background, whether they are grappling with limited time and resources in seeking financial freedom or are sincere in stewarding their money well as a token of gratitude for God's provision. With a focus on responsible investing, Hailey balances caution and opportunity, believing life's too short to stress over market fluctuations. Beyond the pursuit of profits, she advocates for investments aligned with building a better world. As Manager of Content at ProsperUs, she leverages her journalism background from The Edge Malaysia, where she honed her skills at the capital and corporate desk.

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