• Singapore’s nodx decelerates in June, momentum likely to slow down further in Q3 2018

    Source: FxWire Pro - Commentary / 17 Jul 2018 13:54:13   America/New_York

    Singaporean NODX decelerated more than anticipated in the month of June. It slowed to 1.1 percent on a year-on-year basis and dropped 10.8 percent sequentially. Bloomberg consensus expectations were for 7.8 percent on a year-on-year basis and a fall of 8.7 percent sequentially. Today’s is a considerable moderation from May’s 10.3 percent year-on-year and the slowest since March 2018 and likely reflects both trade war concerns and moderating electronics momentum, noted Selena Ling, Head of Treasury Research & Strategy, OCBC Bank.

    Electronics exports dropped again by 7.9 percent year-on-year in June, similar to the -7.8 percent year-on-year in May. The drag was focused in parts of PCs, ICs and diods and transistors, which more than countered the growth in exports of disk media products and PCs. Given that the July-August base effects remain challenging, electronics exports momentum might continue to be lacklustre in the near-term.

    Non-electronics exports sustained its third consecutive month of growth at 4.6 percent year-on-year in June, but also decelerated from the double-digit growth seen in May and April at 26.2 percent year-on-year and 19.6 percent year-on-year respectively. Pharmaceuticals exports also rose for the third straight month by 19.1 percent year-on-year in June.

    NODX growth for January to June period decelerated to 5.4 percent from 9.1 percent growth seen in the same period last year. NODX momentum is expected to slow down further into the third quarter of this year. As such there is some downside risk to full-year 2018 NODX growth forecast, assuming potential further disruptions to regional supply chains if the next leg of USD 200 billion of US tariffs on Chinese imports materialize in September, stated Selena Ling.

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