Chart of the Day: Here's a flashing red warning that exports to big markets are nosediving

And Singapore must get its act together.

As one of the world's monster exporters, Singapore must be shaking at the knees knowing that its shipments to its biggest and key markets are starting to plummet sharply.

According to Maybank Kim Eng, NODX to the EU fell by -22.6% YoY in May 2014 (Apr 2014: -10.8% YoY) coinciding with lackluster economic data in the 28 country block of late following the positive start in early 2014. 

Here's more from Maybank Kim Eng:

Manufacturing PMI readings in May 2014 were the lowest in five months, coming in at 52.2 (Apr 2014: 53.4) led down by readings in France (May 2014: 49.6; Apr 2014: 51.2) and Germany (May 2014: 52.3; Apr 2014: 54.1).

On the consumption side, Markit’s Eurozone Retail PMI reported borderline contractions of 49.9 in May 2014 compared to a three year high of 51.2 reported in Apr 2014.

Individual country retail PMI data showed consumption trends being driven by Germany (May 2014: 52.5; Apr 2014: 53.1) and France (May 2014: 50.5; Apr 2014: 50.3) as readings in Italy continued to deteriorate (May 2014: 45.2; Apr 2014: 49.5).

The ECB announced several policy measures on 5 Jun 2014 to spur the economy while dealing with the risk of deflation, which included: a 10bps cut in its benchmark interest rate to the record low of 0.15%; negative interest rate of -0.10% on its deposit facility; and plans to boost liquidity and bank lending via two tranches of four-year targeted long-term refinancing operations (TLTROs) as well as purchases of asset-backed securities.

Hong Kong and Thailand were the other two notable drags to NODX headline growth in May 2014. Exports to Hong Kong fell by -28.6% YoY (Apr 2014: -18.8% YoY) due to aircraft parts, parts of ICs and electrical circuit apparatus.

NODX to Thailand in the meantime plunged by -29.0% YoY (Apr 2014: +6.5% YoY) as the high base from last year’s record shipment value of SGD 763m normalised. On the other end of the contribution scale was positive gains from shipments to China (May 2014: +7.1% YoY; Apr 2014: +22.6% YoY).

The double digit gains in the preceding nine months will likely be more moderate in the coming months even as effects from the mini-stimulus measures announced in early Apr-2014 begin to stablise the Chinese economy. There have also been subsequent policy announcements to boost targeted liquidity and lending to soften the impact of de-leveraging (especially in shadow banking).