Singapore’s industrial production rose at the slowest pace in four months in June as pharmaceutical and electronic manufacturers made fewer goods, suggesting demand may ease as the global recovery cools.

Output at factories, which accounts for about a quarter of the economy, climbed 26.1% in June from a year earlier, after a revised 58.4% surge in May, the Economic Development Board said in a statement today. The median estimate of 10 economists surveyed by Bloomberg News was for a 38.4% gain.

 

Singapore’s economy grew at a record pace in the first half as demand for its computer chips and manufactured goods recovered from a trade slowdown that pushed the nation into a recession last year. The outlook for the rebound is clouded as governments in Europe embark on austerity programs to cut deficits and households in some of the world’s largest economies hold back spending.

 

“The growth momentum in the manufacturing sector is set to slow in the months ahead,” Irvin Seah, an economist at DBS Group Holdings in Singapore, said before the report. “A subpar recovery in the U.S., slowdown in eurozone as well as tighter policy conditions in Asia are factors pointing to weaker external demand and industrial production ahead.”

 

Production in the second quarter rose 44.5%, less than the government’s preliminary estimate earlier this month of 45.5%. Singapore’s economy accelerated to an unprecedented 18.1% pace in the first half, prompting the government to raise its GDP forecast for the third time this year to as much as 15%.

Electronics shipments by companies including Venture Corp., Singapore’s biggest electronics contract manufacturer, climbed 43.9% in June from a year earlier, while pharmaceutical shipments rose 29.8%, a report this month showed.

 

Singapore’s non-oil domestic exports will probably gain between 17% and 19% in 2010, from a previous projection of as much as 17%, the trade promotion agency said July 14.

 

Industrial production dropped a seasonally adjusted 23.4% in June from May, when it advanced 5.2% from a month earlier.

 

Electronics production jumped 46.8% from a year earlier, following a revised 52.1% gain in May. Pharmaceutical output climbed 30.8%.