SINGAPORE, July 3 (Xinhua) -- Business conditions in Singapore's private sector continued to improve at the end of the second quarter, albeit at a softer pace, with the seasonally adjusted Purchasing Managers' Index (PMI) easing to 51.0 in June from 51.5 in May, according to a report released Thursday by S&P Global.

A PMI reading above 50 indicates expansion, while a figure below 50 signals contraction. Although June marked the fifth consecutive month of expansion, the latest reading reflects the weakest rate of improvement since February.

The report noted that firms continued to reduce both staffing and inventory levels. Meanwhile, lead times shortened for the first time in nearly two years.

Output growth was broadly in line with the long-run trend, and new business growth accelerated slightly. Cost pressures eased, enabling firms to hold charges steady. Business sentiment also improved, with confidence reaching its highest level in three months.

Jingyi Pan, economics associate director at S&P Global Market Intelligence, noted that despite the month-on-month softening, average output growth in the second quarter outpaced that of the first quarter.

"That said, caution with hiring and inventory levels prevailed in June. This was despite a slight acceleration in the rate of new business expansion and reflected subdued optimism among companies, especially given lingering jitters over the global economic outlook amidst trade policy uncertainty," said Pan.

Meanwhile, in a separate report, the Singapore Institute of Purchasing and Materials Management said on Wednesday that the country's manufacturing PMI rose by 0.3 point from May to 50 in June, indicating that overall factory activity returned to expansion territory following two consecutive months of contraction. ■