Singapore's non-oil domestic exports (Nodx) did the unexpected last month by jumping 17.6 per cent, albeit from a low base a year earlier.
Economists polled by Reuters were expecting exports to drop 8.9 per cent year on year, with more and more countries enforcing lockdowns amid the Covid-19 outbreak.
Last month's gain follows a revised 3.1 per cent increase in February, which also benefited from a low-base effect, Enterprise Singapore said yesterday.
The surge last month was led by a 20.5 per cent rise in shipments of non-electronics products.
This came from non-monetary gold, which swelled 242.5 per cent. Specialised machinery shipments were up 54.2 per cent and pharmaceuticals rose 48.6 per cent.
Nodx was still up 2.3 per cent year on year if the volatile gold and pharmaceutical exports were excluded, Nomura International said.
Nomura analyst Euben Paracuelles said the data shows exports are holding up despite the Covid-19 disruption.
Maybank said the March numbers mean Nodx was up 5.8 per cent in the first three months of the year, the best quarterly performance since the third quarter of 2018.
Enterprise Singapore said non-monetary gold exports accounted for about 70 per cent of the growth in last month's Nodx.
Gold exports had dropped 82 per cent year on year in February, but demand for the physical metal has since soared worldwide as a safe haven asset amid the volatile swings in global financial markets.
DBS Bank senior economist Irvin Seah noted gold's contribution to overall export earnings, but said the commodity has little impact on economic growth.
However, electronics exports also grew, rising 5.8 per cent after a 2.5 per cent increase in February.
"That is a more positive surprise and should raise hopes for the manufacturing sector," Mr Seah said.
LIKELY DOWNSIDE AHEAD
Nodx is likely to underperform in April and possibly in the coming months as well. With the one-month circuit breaker, and coupled with the rising probability of an extension, there may still be downside to come.
MS SELENA LING, OCBC Bank's head of treasury research and strategy.
It appears the surge in the number of people working from home may have boosted demand for some consumer electronics, he added.
Electronics exports largely consist of parts and intermediate components used in final electronic products, such as integrated circuits, which reversed 12 straight months of decline.
Nodx rose 12.8 per cent month on month after February's 4.7 per cent fall. This gain was helped by an increase in both electronics and non-electronics domestic exports.
"The month-on-month gain is also a big surprise as that is seasonally adjusted to eliminate the base effect and goes to show that despite a lot of uncertainty and the recession, it is not all doom and gloom," said Mr Seah.
However, most analysts are not too optimistic about the outlook, with the world economy heading for its worst recession since the Great Depression in the 1930s.
Ms Selena Ling, OCBC Bank's head of treasury research and strategy, said: "Nodx is likely to underperform in April and possibly in the coming months as well.
"With the one-month circuit breaker, and coupled with the rising probability of an extension, there may still be downside to come."
UOB Group economist Barnabas Gan said that despite the better-than-expected March data, he is maintaining his outlook for Nodx to contract by 1 per cent this year. "We note that the factors that have led to the positive numbers may be transient in nature," Mr Gan said.
Enterprise Singapore data showed that exports to most of Singapore's top markets increased last month, except for Malaysia, Indonesia and China. The top export markets were Thailand, the United States and Japan. Thailand and the US were also the biggest importers of gold as well.
While exports to China fell 0.5 per cent year on year, that was actually a big improvement from a sharp decline of a combined 15.3 per cent in the January-February period.
"In our view, this likely reflects a relaxation of lockdown measures in China," Mr Paracuelles said.
China's economy shrank 6.8 per cent in the first quarter from a year earlier, the worst performance since at least 1992 when official releases of quarterly gross domestic product started. However, the world's second-largest economy is gradually resuming business activity amid a slowdown in its Covid-19 outbreak.