Sectors Performance In December 2025
In December 2025, Singapore’s industrial production declined by 13.3% month-on-month. This drop was in line with predictions, mainly due to an 85.8% decrease in pharmaceuticals output. Despite the overall decline, industrial production increased by 8.3% year-on-year. Sectors such as electronics and transport engineering showed strong growth.
The electronics sector showed a 30.8% year-on-year increase in December, up from 18.1% in November, driven by demand for AI-related products. Transport engineering remained strong, with a 19.9% year-on-year increase, supported by marine and offshore engineering, which grew by 8.5%, and aerospace, which increased by 35.9%.
This data demonstrates varying performances across different sectors within Singapore’s manufacturing industry. The pharmaceuticals sector’s decline significantly impacted the overall figures, while electronics and transport engineering sectors helped keep the year-on-year numbers positive. These trends indicate diverse shifts across industrial activities during the last quarter of 2025.
Given the December 2025 industrial production figures, we should view the Singaporean market with a sector-specific lens. The headline month-on-month drop of 13.3% is alarming, but it’s almost entirely due to a single volatile segment. The underlying year-on-year growth of 8.3% shows that other parts of the economy are performing very well.
The 85.8% monthly plunge in pharmaceuticals output should be treated with caution, as this sector has a history of extreme volatility based on the production schedules of a few large plants. Looking back at data from 2023 and 2024, we saw similar large swings in biomedical output, which often correct sharply in the following quarter. Therefore, aggressive short positions based on this one data point are risky; it may be better to wait for January’s data or use options to define risk on any trade.
Electronics And Transport Engineering Growth
The real story is the sustained strength in electronics, which grew 30.8% year-on-year, driven by artificial intelligence demand. This trend is confirmed by the World Semiconductor Trade Statistics (WSTS) organization, which just last week upgraded its 2026 global market forecast to 15% growth, citing the AI infrastructure boom. Traders should consider long positions on semiconductor-related stocks or ETFs, as this momentum is likely to continue in the coming weeks.
Transport engineering also provides a solid foundation, growing nearly 20% from the year before, with aerospace up an impressive 35.9%. Recent January 2026 earnings reports from global airlines have highlighted a surge in aircraft maintenance and service demand in the Asia-Pacific hub. This points to continued strength, making long positions in Singapore’s aerospace sector an attractive strategy.
For the Singapore Dollar, the situation is complex. While the strong export performance in electronics and transport is a positive driver, the latest CPI data for December 2025 showed core inflation remaining above the central bank’s target. This may lead the Monetary Authority of Singapore to maintain its tightening stance, creating a floor for the currency despite the weak headline production number.
