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In August, NODX fell by 20.1% YoY.
With Singapore’s non-oil domestic exports predicted to see more year-on-year contraction in the months ahead, UOB has lowered its full-year forecast to -15%.
Previously, UOB predicted a contraction of 10%.
UOB’s latest prediction is “well exceeding the lower end of the government’s revised NODX forecast range of -10.0% to -9.0%.”
“Unless there is a sharp trade recovery in late 2023, the current NODX contraction trajectory will easily tip the full year 2023 decline well beyond the official -10% threshold.” Alvin Liew, UOB senior economist, said.
The revision of UOB’s forecast came after the August NODX. In August, NODX fell by 20.1% YoY.
“Our earlier guarded enthusiasm due to the surprise back-to-back rebound in semiconductors output in June and July is now curbed by the latest August trade report which still reflects the persistent downturn in NODX, and together with the broad-based weakness in both electronics and non-electronics performance, continued to weigh negatively on manufacturing, demand for Singapore,” Liew said.
“The resumption of NODX decline to the US and the continued weakness of NODX numbers to EU 27 and major North Asian export destinations, especially China, weighs negatively on the trade outlook and we therefore maintain our call to expect sustained weakness in global demand amidst an ongoing electronics downcycle,” Liew added.
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