That was lower than expected. Economists polled by Dow Jones Newswires predicted January's output would fall 2.3 percent from December in seasonally adjusted terms.

Compared to a year ago, output rose 1.3 percent, the Economic Development Board said Monday.

The government agency said a contraction in the volatile biomedical and pharmaceutical sector masked strong contributions from transport engineering and electronics.

Fewer production days in January due to the Lunar New Year holidays also lowered industrial output, the board said.

Electronics, which accounts for a third of manufacturing output, grew 18.4 percent from a year earlier, slower than December's 20.3 percent growth.

The sector thrived on a 37.5 percent jump in semiconductor output and a double-digit growth in production of communications and consumer electronics.

The biomedical sector contracted 33.8 percent from a year earlier, hit by a 34.9 percent drop in the output of drugs because of a different product mix, the agency said.

Excluding the biomedical sector, January's industrial output rose 11.2 percent from a year earlier.

Transport engineering output surged 23 percent from a year earlier, helped by marine and offshore engineering's 30.8 percent growth as ship and oil-rig building and ship repairing activities continued their rapid expansion.

Singapore companies Keppel Corp. Ltd. and Sembcorp Marine Ltd., the world's biggest producers of offshore rigs, are benefiting from increased exploration activities sparked by higher oil prices.

Output in the precision engineering segment rose 7.2 percent from a year earlier while production from the chemicals sector dropped 2.1 percent as demand slowed in January because of plant closures.

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