Singapore’s non-oil domestic exports (NODX) deteriorated further on a y/y basis in Jun, affirming the troubled trade outlook. NODX plunged by -15.5% y/y in Jun from -14.8% y/y in May, in line with the Bloomberg median estimate of -15.6% but better than our more bearish forecast of -17.2%. This was the 9th straight month of NODX contraction after 22 months of unabated expansion. 

On a seasonally adjusted sequential basis, NODX recovered from May’s steep tumble of -14.6% m/m, and was up 5.4% m/m in Jun, quite in line with our forecast of +5.0% but much better than Bloomberg’s median estimate of -3.6%.

NODX Outlook – The latest Jun trade report 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. The more negative prints on NODX declines to several major export destinations, also affirmed our cautious outlook and we maintain our call to expect sustained weakness in global demand amidst an on-going electronics downcycle. And with NODX to US turning negative in Jun, that added more gloom to the demand outlook for the developed markets amidst the likelihood of further monetary policy tightening in the near term. The rebound in Hong Kong’s Jun NODX and the second month of positive China’s NODX growth are welcome signs although we again, are uncertain if it can be sustained.