Singapore industrial production fell sharply in March, with output falling 16.0 percent on the month after increasing 14.6 percent in February. Previously published trade data showed a fall in exports in March, while PMI survey data showed slower but still strong growth in the aggregate economy.

In year-over-year terms, industrial production fell 9.2 percent in March after increasing 4.4 percent in February. This weakness was largely driven by the electronics industry, which accounts for nearly half of the sector, with output here falling 11.3 percent on the year after increasing 3.9 percent previously. In the biomedical industry, where output is often volatile, year-over-year growth swung from an increase of 26.8 percent to a decline of 34.3 percent. Output growth was mixed in other parts of the sector. Excluding the biomedical industry, output fell 5.9 percent on the year in March, down from growth of 2.0 percent in February.

After February's 14.2 percent lunar-year surge, industrial production is expected to fall 8.8 percent in March. The year-over-year rate is seen falling 1.5 percent versus February's growth of 3.8 percent.

The industrial production index measures changes in the volume of industrial production with respect to the base year. The index charts the growth in production of each major industry and of the manufacturing sector. Industrial Production measures the physical output of the nation's factories, mines and utilities. Factories manufacture various products, and the industrial production indexes have been prepared as a comprehensive indicator of wide-ranging production activities for such products and are regarded as some of the most important among economic indexes.

Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that won't lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.

Industrial production provides key industry data for export-dependent economies. It is highly sensitive to the business cycle and can often predict future changes in employment, earnings and income. For these reasons industrial production is considered a reliable leading indicator that conveys information about the overall health of the economy. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Detailed data in the report shows which sectors of the economy are growing and which are not.