Business optimism index rises to 5.91 percentage points in Q12022

The moderate increase was driven by expansions in five out of six indicators.

Singapore’s business optimism index (BOI) grew in the first quarter of 2022, increasing to 5..91 percentage points from 5.78 in the fourth quarter of 2021, the Singapore Commercial Credit Bureau (SCCB) reported.

SCCB attributed the marginal increase in the BOI to the expansions recorded in five out of the six business indicators. 

In particular, indicators that were in positive territory were the volume of sales (3.79 percentage points); new orders (10.45 percentage points); and employment elves (13.53 percentage points).

Though falling from the previous quarter,  net profit was still expansionary with 4.58 percentage points.

Inventory levels, on the other hand, remained contractionary at -0.75 percentage points despite improving from the fourth quarter 2021’s figure of -5.35 percentage points.

 Across sectors, outlook was most upbeat in manufacturing and financial, having six and five indicators, respectively, in positive territory.

Here’s SCCB’s overview of how sectors performed in the six business indicators:

Volume of Sales 

The financial sector (net +16.67 percentage points) is most upbeat, followed by services (net +9.09 percentage points) and manufacturing (net +7.41 percentage points). The mining (net -40.0 percentage points) and agriculture (net -20.0 percentage points) sectors are pessimistic. The remaining sectors have anticipated volume of sales to remain unchanged – construction, transportation and wholesale (net 0 percentage point).

Net Profit 

The financial sector is most upbeat (net +16.67 percentage points), followed by services (net +9.09 percentage points) and manufacturing (net +7.41 percentage points). Both mining and agriculture (net -20.0 percentage points) are downbeat while the remaining sectors have anticipated net profit to remain unchanged - construction, transportation and wholesale (net 0 percentage point).

Selling Price 

The financial sector (net +25.0 percentage points) is most upbeat, followed by construction (net +14.29 percentage points), transportation (net +9.09 percentage points) and manufacturing (net +3.70 percentage points). Both agriculture and wholesale (net 0 percentage point) have anticipated selling price to remain unchanged. The mining (net -20.0 percentage point) and services (net -2.27 percentage points) sectors are downbeat about selling price.

New Orders

The financial (net +25.0 percentage points) sector is most upbeat, followed by transportation (net +18.18 percentage points), construction (net +16.67 percentage points), manufacturing (net +14.82 percentage points), services (net +6.82 percentage points) and wholesale (net +6.25 percentage points). The agriculture sector (net 0 percentage point has anticipated new orders to remain unchanged. The mining sector (net -25.0 percentage points) is downbeat about new orders.

Inventory Levels 

The manufacturing sector (net +7.41 percentage points) is the only sector that is most upbeat. Both agriculture (net -20.0 percentage points), mining (net -25.0 percentage points) and wholesale (net -6.25 percentage points) sectors are downbeat. The remaining sectors – construction, financial, services and transportation (net 0 percentage point) have anticipated inventory levels to remain unchanged.

Employment 

The financial (net +58.33 percentage points), manufacturing (net +25.93 percentage points) and transportation (net +9.09 percentage points) sectors are most upbeat. The agriculture, construction, wholesale and mining sectors (net 0 percentage point) expected employment to remain unchanged. The services sector (net -6.82 percentage points) is downbeat about employment.