SINGAPORE (Reuters) - Singapore’s non-oil domestic exports (NODX) surged in August from a year earlier at the strongest pace in six months, led by solid shipments of electronics and robust sales to China.
Exports increased 17.0 percent in August from a year earlier, data from the trade agency International Enterprise Singapore showed on Monday. This was the largest year-on-year increase since February.
It was also more than the 11.8 percent increase predicted in a Reuters survey.
On a seasonally adjusted month-on-month basis, exports rose 4.5 percent, exceeding the median forecast in the Reuters survey of a 3.1 percent expansion.
Shipments to China soared 43.2 percent from a year earlier.
Electronics exports, a major driver of shipments in recent months, rose 21.3 percent in August from a year earlier.
“Electronics once again proved to be the one of the most important drivers, which might raise concerns about the narrowness of the export story,” Robert Carnell, head of Asia-Pacific research for ING said in a note.
The latest export data will help the Monetary Authority of Singapore justify keeping the policy band of the Singapore’s dollar’s nominal effective exchange rate unchanged at its policy decision due in October, rather than provide any cause for tightening, he added.
“If the good news continues, and is matched by some stronger consumer spending data, this should become a possibility for 2018,” Carnell said regarding possible policy tightening by the MAS.
Singapore and other Asian economies that are highly dependent on trade have gained a big boost this year from an improvement in global demand, particularly for electronics products and components such as semiconductors.
While there were worries that Singapore was overly dependent on electronic exports, the economy grew faster than initially estimated in the second quarter thanks to a rebound in services, suggesting a broader and more balanced recovery after a stumble early in 2017.
Stronger global trade in general this year has also benefited Singapore, which boasts one of the world’s largest container ports and a global air cargo hub.
Reporting by Fathin Ungku; Editing by Richard Borsuk