Here's what buoyed Singapore's NODX in December

A weaker SGD contributed partially to the good showing.

Singapore exports delivered a strong growth yet again in December, up 9.4% YoY after the stunning 11.5% surge in the previous month.

According to DBS, a low base and a weaker Singapore dollar that month contributed partially to the good showing. But beyond that, the firm said the improvement in US consumption as well as cyclical bottoming out in China provided much needed support.

"In fact, NODX to China was up by a whopping 33.5% on-year, partly on account of stimulus measures to prop by domestic growth within the economy," it said.

However, DBS said a pullback could be on the cards.

"With the Lunar New Year just around the corner and manufacturers in China heading into a lull period, that should not come as a surprise. Indeed, NODX grew by only 1.0% on-month seasonally adjusted in December, down from 13.0% previously," it noted.

DBS furthered, "But any form of pullback will be transient. Although there are still risks on the horizon pertaining to key markets such as China, the US and the Eurozone, economic conditions are generally improving in the near-term. Barring any policy risk from the US, the worst of the export cycle is probably behind us."