Singapore’s export growth surpasses expectations for second straight month in December

Singapore’s non-oil exports growth surpassed expectations for the second straight month in December. NODX continued with its solid performance streak in December, expanding 9.4 percent year-on-year. On a sequential basis, it rose 1 percent on a seasonally adjusted basis. Market projections were rise of 5.8 percent year-on-year and a drop of 5.5 percent sequentially.

In November, Singapore’s NODX growth came in at 11.5 percent year-on-year and 13.1 percent month-on-month. For 2016 as a whole, the exports grew 2.4 percent on a year-on-year basis; however, it is still moderation from previous year’s print of 0.2 percent year-on-year. However, the NODX data imply that NODX has bottomed in the second half of 2016, said OCBC Economist in a research report.

Electronics exports grew for the second consecutive month by 5.7 percent year-on-year, as compared with November’s print of 3.5 percent year-on-year. On the other hand, non-electronics exports expanded 11.3 percent as pharmaceuticals also grew 7.3 percent year-on-year in December.

“We anticipate that global demand for OLED displays, dual-lens cameras, fingerprint technology and touch screens could remain key industry drivers in 2017 and sustain the manufacturing momentum for 1H17”, noted Selena Ling, Head of Treasury Research & Strategy, OCBC Bank.

NODX to six of the top 10 markets were up in December 2016, except for Japan, EU, U.S. and Malaysia. China led NODX, which registered 33.5 percent. This implies that Chinese demand was benefitting from the coordinated policy accommodation. Even the International Monetary Fund was slightly positive on the global economic prospects, expecting that global growth would accelerate to 3.4 percent this year and 3.6 percent next year from 3.1 percent last year.

“We tip 2017 NODX growth at 0-2 percent yoy, with the caveat that Trump’s anti-trade/China policies if they materialise could present a potential headwind”, added Selena Ling.