Singapore's manufacturing sector predicted to grow 5% in 2H

But here's the condition.

Accordng to CIMB, assuming drug manufacturing or transport engineering does not fall over the cliff, it believes manufacturing can expand by about 5% in 2H13 (1H13: -3.2%) to support 4% GDP growth in 2H13 or 3% for the full year.

Here's more:

Citing an improving macroeconomic backdrop, the government raised its 2013 GDP outlook even though it lowered its trade and NODX today due to the poor 1H13 trade performance.

Total trade (1H13: -5.5% yoy) and NODX (1H13: -8.8% yoy) was cut to 2-3% yoy and 0-1% yoy, respectively, from 3-5% and 2-4% previously. On a positive note, leading indicators such as PMIs suggest improving global demand in the seasonally busier half of the year.

With the help of an undemanding year-ago base (2H12 GDP slowed to o.8% yoy due to eurozone and US fiscal cliff worries), we expect the export drag to reduce in the coming months.