Defying the sceptics who have warned of slower growth, exports in August surged at their fastest pace in six months. Shipments to China rebounded while electronics sales, which many thought would taper off, continued to boom.
Non-oil domestic exports (Nodx) rose 17 per cent last month over August last year, comfortably higher than the 11.8 per cent increase economists had predicted.
The export momentum is riding on a surprisingly broad base.
Electronics shipments jumped 21.7 per cent last month from a year earlier, owing to a healthy appetite for consumer gadgets as semiconductor firms geared up for the iPhone 8 production cycle.
Non-electronics exports rose 15 per cent in August, after a sedate 4.4 per cent growth in July.
Notably, exports of non-monetary gold jumped 137.7 per cent last month. This refers to gold not held as reserve assets by central banks. Brewing tensions with North Korea and lofty valuations in financial markets could have stoked interest in the safe haven asset.
Nodx to all of Singapore's top 10 markets, except Taiwan, rose last month.
China, the largest market for Singapore's exports, also provided the springboard for growth as shipments to the mainland surged 43.2 per cent in August from a year earlier. Fiscal stimulus has helped China expand more rapidly than expected in the first half of this year.
"That has given new life to Asian imports across many parts of the manufacturing value-chain," said OCBC Bank economist Selena Ling.
United Overseas Bank economist Francis Tan has turned cautious on China, noting that latest indicators showed the economy had "unexpectedly cooled further in August after a lacklustre July, as factory output, investment and retail sales all slowed".
But Ms Ling said even if China's growth "decelerates slightly" from now till the end of the year, full-year growth is likely to still exceed its target of around 6.5 per cent.
The export story outside of China is also bright. Nodx to South Korea jumped 62 per cent last month, and shot up 33.1 per cent to Japan, according to data from trade agency International Enterprise Singapore yesterday.
Singapore's exports to the United States also reached a two-year high in August, noted Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye. "Continued export momentum in July and August is pointing to strong third-quarter GDP (gross domestic product) growth," they said.
Still, Mr Tan warned that the semiconductor industry goes through stages: "The current electronics cycle may be coming towards an end, with the rolling out of the next wave of smartphones in the months ahead."
Moody's Investor Service also noted that sluggish investment trends suggest that firms here are still using existing idle capacity to meet increased demand.