Singaporean NODX recovers solidly in December, likely to continue to rebound in 2020

Singapore’s NODX recovered strongly in the month of December. On a year-on-year basis, the NODX rose 2.4 percent, while it rose 1.1 percent sequentially. Bloomberg consensus forecast was for a fall of 1 percent year-on-year and a drop of 1.5 percent sequentially. This was a considerable rebound from November’s fall of 5.9 percent year-on-year. This marked an end to a nine month drop. This is a positive close to an eventful and volatile 2019 where headwinds like the U.S.-China trade war and geopolitical uncertainties loomed large.

Electronics exports continued to be soft at -21.3 percent in December, close to the 23.3 percent seen in November. Non-electronics exports accelerated to 11.5 percent year-on-year in December, up from 1.2 percent in November, and was largely driven by pharmaceuticals exports. Non-monetary gold exports also rose sharply by 127.8 percent year-on-year in December, mainly to China.

Markedly, exports to 8 of the top 10 NODX markets also rose in December, led by South Korea, Taiwan, EU28, China and the U.S., whereas the two laggards were Hong Kong and Indonesia.

“Our 2020 NODX growth forecast is for an improvement to 2-4 percent yoy, predicated on a macroeconomic stabilization in the global and regional economies, and that US-China trade tensions will not escalate further”, said Selena Ling, Head of Treasury Research & Strategy, OCBC Bank.