Chart of the Day: Singapore’s NODX in danger of contracting again after last year’s painful 6% drop

The losing streak continues.

Singapore is a small and open economy where export performance is key to growth. Non-oil domestic exports (NODX) have been lacklustre this year.

According to DBS, after the disappointing 3Q14 GDP figures, non-oil domestic exports (NODX) for September out last Friday were also weak. Sequentially, NODX plunged 8.8% (MoM sa) after a 7.6% rise in August. This will put more pressure on GDP growth this year.

NODX is down by 0.9% compared to the same period last year. The risk is that NODX could post another full year contraction after a 6% drop in 2013.

DBS notes that NODX has never fallen in two consecutive years except during the global financial crisis in 2008-09, when sales fell by 8% and 10.5% respectively.

Here’s more from DBS:

Plainly, there will be significant downside risks to GDP growth if NODX remains in the doldrums.

On that, growth has been below expectation thus far. Consensus still has full year GDP growth penciled in at 3.3% based on MAS survey. Our full year forecast remains at 3.0%. Chance is high that the market (including DBS) will be paring down its expectation pretty soon if the 3Q14 GDP figures are not revised upwards.