Business sentiment among Singapore firms edged up slightly for the first time after three consecutive quarters of decline, according to the latest Business Optimism Index by the Singapore Commercial Credit Bureau (SCCB).
The index was +6.91 percentage points in the third quarter this year, up from +5.08 percentage points in the second quarter. However, the index lost ground versus its reading of +10.58 percentage points in the third quarter of last year.
The figures were derived from polling 200 business owners and senior executives representing major industry sectors across Singapore, and are calculated by subtracting the percentage of respondents expecting decreases from the percentage expecting increases.
Five of six indicators used by the index - sales, profits, employment, new orders and inventories - advanced.
Only selling price fell compared with the second quarter, to -7.32 percentage points from 4 percentage points.
Only net profit and employment increased versus the same year-ago period.
The service sector was the most optimistic, following the overall index with the same five indicators increasing and selling price falling.
Construction saw numbers dip for three indicators, while transportation and manufacturing had figures falling for five indicators. The SCCB attributed transportation's slowdown to contraction in the water transport segment, and said the manufacturing sector suffered from a tepid semiconductors sub-segment.
SCCB chief executive Audrey Chia said the bureau was cautious for the next quarter, despite the slight rebound in sentiment, due to mounting downside economic risks from the ongoing US-China trade tensions, and an uncertain global growth outlook.
The SCCB expects a lukewarm Singapore manufacturing sector in the third quarter, with market maturity and global trade issues posing particular challenges for the electronics and precision engineering sectors.
"The service sector will still remain a key pillar of growth for 2019, driven largely by an expansion in the business services, information and communication sub-sectors," added Ms Chia.