SINGAPORE - Exports shrank for the seventh month in a row, even though the pace of contraction eased.
Non-oil domestic exports (Nodx) fell by 8.1 per cent in September, a somewhat better showing than the 9 percent fall in August, according to data released by Enterprise Singapore on Thursday (Oct 17).
This was the third month in a row where shipments improved, and the August figure – revised downwards from the 8.9 per cent fall previously reported – also marked a return to single-digit territory after five consecutive months of double-digit declines.
But analysts polled by Bloomberg had been more optimistic for September, expecting a 7.2 per cent fall.
On a month-on-month seasonally-adjusted basis, export figures were down 3.3 per cent in September, after a 6.7 per cent rise in August.
UOB economist Barnabas Gan said the ongoing maturing of the global electronic cycle and the negative effects of the United States-China trade tensions continue to drive the slowdown in Singapore’s trade environment.
“The slack in the semiconductor exports across Asia Pacific is still being observed in Singapore, suggesting that the maturing global electronic cycle could still drag both exports and manufacturing momentum into the months ahead,” he said.
Electronics products weighed down Nodx, shrinking 24.8 per cent year-on-year in September, following a 25.9 per cent contraction in August.
Integrated circuits, personal computers and disk media products contributed most to the decline.
Non-electronic exports contracted by 2.3 per cent - the same rate as in August. Pharmaceuticals, petrochemicals and jewellery caused the most drag.
Exports to the majority of Singapore's top markets fell, except to China and Taiwan. The biggest declines in shipments were to the European Union, the United States and Japan.
Exports to emerging markets declined by 22.4 per cent last month, worse than the 19.6 per cent fall in the previous month.
Overall, both total imports and total exports decreased in September, but by less than the declines in August.
Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye noted that the better Nodx data in September was inflated by a surge in non-monetary gold exports to China, while electronics exports to China plunged at a steeper pace.
They said that Nodx likely bottomed in the second and third quarters and may see some improvement in the last quarter of the year, given the lower base of comparison a year ago.
However, they expect economic growth in the last quarter to be supported by non-trade related services including finance, business services such as property transactions, and tourism-related sectors due to diversion from Hong Kong.
On Monday, the Monetary Authority of Singapore eased the Singdollar's rate of appreciation for the first time in more than three years. It said it expects Singapore's growth, which slowed over the first three quarters, to pick up modestly next year, subject to considerable uncertainty in the external environment.
Correction note: An earlier version of this article said the biggest declines in shipments were to Japan, the European Union and Hong Kong. These are the markets with the biggest percentage declines. The article has been amended to reflect the markets with the biggest declines in value of shipments.