Singapore’s trade data contract in April, snapping growth streak

Leslie Shaffer

Singapore's non-oil domestic exports (NODX), closely watched for clues on economic growth, contracted in April, belying expectations for growth.

NODX for April contracted 0.7 percent on-year, after five straight months of growth, the International Enterprise Singapore data showed on Wednesday. That compared with a Reuters forecast for a 12.4 percent increase.

On a month-on-month seasonally adjusted basis, NODX fell 9.0 percent, compared with a Reuters forecast for a 4.1 percent contraction.

Francis Tan, an economist at UOB, said the result was in line with his expectations.

"We think that this is only a temporary, technical pullback from an exceptionally strong month in March," Tan said in a note on Wednesday.

He noted that NODX growth rates are "notoriously volatile" and his longer term view remained for a global trade recovery this year.

"We are also expecting that the strong double digit NODX growth since November 2016 cannot be sustained into the second half of 2017. This is especially since recent trade numbers reported by Asian economies also point to a slower growth rate," he said.

But Tan added, "Slower growth does not mean no growth. We are expecting Singapore's 2017 NODX to finally expand, after recording four previous years of contraction."

IE Singapore attributed the contraction to a decline in non-electronic NODX offsetting growth in the electronics segment.

NODX came in at 13.6 billion Singapore dollars ($9.75 billion) for the month on a seasonally adjusted basis, down from S$14.9 billion in March, the data showed.

The electronics segment expanded for a sixth straight month, rising 4.8 percent on-year, with growth in PC parts and disk-media products the biggest contributors.

But non-electronic NODX fell 2.9 percent, after rising 20.8 percent in March, amid sharp drops in the volatile pharmaceutical segment, as well as falls in non-electric engines and motors and non-monetary gold.

But total trade still rose in April, up 5.7 percent on year, with total exports up 4.2 percent and total imports up 7.5 percent, the data showed, although it noted that on a seasonally adjusted basis, total trade declined 4.4 percent on-month to S$76.7 billion.

Follow CNBC International on Twitter and Facebook.