Singapore’s exports rise in November, growth forecasts improved
Singapore’s trade-dependent economy posted a positive surprise, recording a strong rebound in its exports for November. According to data released by Enterprise Singapore, the island nation’s domestic non-oil exports rose 24.2% year-on-year in November, far more than the 17.8% increase seen in October and an increase of 17, 3% predicted by economists.
The surge in exports was also the fastest pace of expansion seen since February 2012, offering hope for a rapid economic recovery from the pandemic and related restrictions. On a monthly basis, exports grew 1.1% month-on-month-adjusted, although the pace of growth was slower than the 4.1% month-on-month growth seen in October.
Exports of electronics were up 29.2% year-on-year for the month, fueled by strong demand for semiconductors around the world. Shipments of integrated circuits (ICs) – the building blocks of electronic equipment, jumped 41.8% year-on-year in November. Another key factor in the strong growth in exports overall was an 80.6% increase in primary chemicals, a 74.4% increase in specialized machinery, and a 66% increase in petrochemicals.
Economists improved their growth forecasts for Singapore in a recent MAS survey. Singapore’s GDP for 2022 could stand at 4% compared to the previous forecast of 3.9% growth instead. This comes even as the Ministry of Trade and Industry forecasted growth of between 3% and 5% for Singapore’s economy in 2022.
Impact on the Singapore dollar
The Singapore dollar did not react much to the news, trading lower against the US dollar. At the time of writing, USD / SGD is trading at around $ 1.365.
USD / SGD
The risk-sensitive currency came under pressure following confirmation from the Fed to implement rate hikes in 2022, which made the USD a strong candidate. There is also uncertainty regarding the potential fallout from the Omicron variant hanging over the minds of traders, keeping SGD low for now.