NODX contraction eases in September with 1.2% dip

Shipments to US, China recovered strongly; electronics still weak[SINGAPORE] Non-oil domestic exports (NODX) fell year-on-year for an eighth consecutive month in September, though the contraction was narrower than market forecasts, as higher non-electronic exports such as ships and petrochemicals helped offset weaker electronics ones.迷你倉Latest trade figures released by trade promotion agency IE Singapore yesterday revealed that NODX eased from a 6.8 per cent year-on-year decline in August to a 1.2 per cent dip last month. Expectations were for a 2.8 per cent drop, leading at least one economist to see NODX picking up gradually."NODX remains weak, but the contraction has eased," observed Chua Hak Bin of Bank of America Merrill Lynch.With last month's decline, Dr Chua estimates that NODX fell 3.3 per cent in Q3, smaller than the 8.9 per cent decline in the first two quarters of the year.Shipments to the United States and China, two of Singapore's largest markets, have recovered strongly, he said. The top three contributors to the export contraction were the European Union, South Korea and Japan.NODX's growth momentum looks set to pick up. Compared to the previous month, September NODX jumped a seasonally adjusted 5.7 per cent, after slipping 6.6 per cent in August.Said Michael Wan of Credit Suisse: "Moving forward, we expect Singapore's export recovery to broaden and gather momentum on stronger global demand, given that growth in the US is expected to accelerate and Europe is likely to continue its move out of recession into recovery."Even so, the turnaround may have come a little too late. OCBC's Selena Lingmini storagenoted that despite the improvement in recent months, NODX had so far dropped 6.7 per cent year-on-year. With three more months to go before year-end, she reckons that NODX is likely to undershoot the official growth forecast of 0-1 per cent for this year."Our 2013 NODX growth forecast is -5.5% year-on-year, likely the worst performance since 2009 (-10.6%), and assuming Q4 NODX growth improves further to -0.6%," she said.Francis Tan and Jimmy Koh of UOB reckon that to meet the official growth forecast, NODX would have to grow between 22.6 per cent and 26.7 per cent on average in the last quarter."Although we are experiencing a cyclical recovery in global electronics demand which will boost electronic exports, it will likely be a muted one, which at best, we may only likely see lower single-digit year-on-year growth rates till the end of this year," they said.Electronic NODX fell year-on-year for the 14th straight month in September, even though the decline eased to 5.5 per cent in September from 9.2 per cent the previous monthNon-electronic shipments swung to a 0.9 per cent increase, from a 5.6 per cent decline.Though NODX remains in negative territory, economists at Citigroup, Barclays and Bank of America Merrill Lynch remain hopeful the economy will grow for the full year."The services sector is supporting economic growth," said Dr Chua of Bank of America Merrill Lynch. "Recent re-export readings are in line with government guidance of 'healthy expansion' in wholesale trade services."Latest trade data showed that non-oil re-exports jumped 12.7 year-on-year last month, after rising 14.4 per cent in August.儲存