Local business sentiments look glum amidst weak sales boost

Outlook has been disappointing for 5 consecutive quarters now.

Compared to the previous years, Singapore's local business sentiments have remained muted and downbeat for the most of 2016, with Q4’s outlook only seeing modest growth.

According to Singapore Commercial Credit Bureau (SCCB)'s latest quarterly Business Optimism Index, business outlook grew slightly from 1.11 percentage points in Q3 to 2.87 points in Q4.

For the said quarter, volume of sales inched upwards from -5.33 to -2.65 percentage points QoQ, but still dragging the overall outlook. Despite this slight improvement, it has remained on the contractionary side for the fifth consecutive month.

Net profits sprung into expansionary zone from -1.33 to 2.65 percentage points.

Selling Price at -6 improved to a flatline 0 point while new orders moderated slightly from 10 to 7.28 percentage points.

Meanwhile, inventory levels slid from 9.33 to 8.61 percentage points.

SCCB's Chief Executive Officer Audrey Chia said while there were signs of a pickup in certain sectors such as manufacturing in the previous months, overall growth prospects remain stagnant and settle into a much slower pace.

“Our findings revealed that majority of the sectors were experiencing a contraction in at least one business indicator. Volume of sales, have in particular been the weakest indicator as it has remained in the negative territory for the fifth straight quarter since Q4 2015. Given the sluggish global economic conditions, external demand will remain weak," she said.