Exports fell sharply for a second month in June, as shipments to Singapore's biggest markets - the United States and Europe - dived amid a global economic slowdown.

Even exports to China, whose economy is still growing strongly, slid 12 per cent on falling sales of electronics parts and consumer electronics.

Overall, the key export figure - known as non-oil domestic exports (Nodx) - fell 10.5 per cent from June last year, matching the decline in May, said trade agency IE Singapore. This was 'due to a fall in both electronic and non-electronic Nodx', it said.

The 10.5 per cent retreat was far worse than the 2.8 per cent drop economists had been predicting.

In quarterly terms, Nodx shrank 5.5 per cent in the period March 1 to June 30 from the same period last year.

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One bright note: Last month's Nodx rose 4.2 per cent after seasonal adjustments from May, when it fell 9.8 per cent month-on-month.

Total trade rose 14 per cent after expanding 16 per cent in May, with total exports rising 11 per cent.

The poor non-oil numbers came just two months after IE Singapore lowered its forecast for export growth this year to between 2 per cent and 4 per cent from an earlier estimate of 4 per cent to 6 per cent.

Last month's downbeat figures have given economists fresh cause for concern. Several are likely to downgrade their overall economic growth forecasts in the weeks ahead.

CIMB-GK economist Song Seng Wun said: 'The unexpectedly bad numbers for May and June suggest a downside risk to our second-half gross domestic product (GDP) growth forecast of 4 per cent to 5 per cent.'

GDP is a measure of economic output.

Mr Song cut his forecast to 4.6 per cent last month and said there was 'a high chance of this forecast being bumped down again'.

Standard Chartered Bank economist Alvin Liew said: 'The sequential contraction in second-quarter GDP could extend into the third quarter, bringing Singapore to its first technical recession since 2002.'

He said the drag on exports was due to falling demand in the key US and European Union markets, confirming that weak external sentiment was clearly having a material impact on exports.

This, in turn, would be 'a significant negative' for the manufacturing sector, which accounted for 26 per cent of GDP last year, he added.

Goldman Sachs analysts Mark Tan and Michael Buchanan noted: 'The external sector should still proceed on a lower growth trajectory on softer global demand. The weakness could extend into next year, and we see downside risks to our growth forecasts for this year and next.'

Electronics exports slumped 14.6 per cent last month in the sector's 17th straight monthly retreat after an 8.5 per cent decline in May.

United Overseas Bank economist Ng Shing Yi noted: 'The outlook for the cyclical electronics industry is grey, with US retail sales for electronics goods still in the doldrums.'

Semiconductor shipments slid 24.5 per cent after falling 12.6 per cent in May.

Non-electronics exports, which include petrochemicals and pharmaceuticals, fell 7.9 per cent. Exports to the US fell 24 per cent, while exports to the EU were down 16 per cent.

alfoo@sph.com.sg