Singapore’s exports fell more than expected in June, marking their biggest decline in six years, as the city-state struggles against tepid global demand and the Sino-US trade war.
The grim trade numbers add to a slew of weak economic data and reinforce economists’ expectations the central bank could ease monetary policy at its October meeting.
Non-oil domestic exports in June fell 17.3 per cent, the fourth month of year-on-year decline, data from the trade agency Enterprise Singapore showed on Wednesday, slowing from the revised 16.3 per cent decline the month before.
This was worse than the 9.9 per cent contraction predicted by 10 economists in a Reuters poll and the biggest decline since February 2013 when exports fell 33.2 per cent from the year before, Refinitiv Eikon data show.
“It’s everything bad coming together. You have a global economic slowdown, a trade war and a Chinese slowdown,” said Selena Ling, economist at OCBC Bank.
The drop in annual exports was mainly due to a 31.9 per cent fall in electronics shipments, reports Reuters.
Exports to the majority of Singapore’s top markets, including China and Europe, fell sharply in June, although those to the United States posted a small rise.
On a seasonally adjusted month-on-month basis, exports contracted 7.6% in June after growing a revised 5.8 per cent in May. The poll called for a 3.9 per cent contraction from the month before.
“The outlook (for Singapore’s economy) is definitely more pessimistic now,” said Maybank Kim Eng economist Lee Ju Ye.
Singapore’s economy grew at its slowest annual pace in a decade in the second quarter, preliminary data showed last week, raising bets that a technical recession and monetary policy easing could be just around the corner.
OCBC’s Ling said the outlook for Singapore’s economy is bleak and she has cut her growth forecast three times this year.
“It doesn’t look like there’s light at the end of the tunnel yet,” she added.