More services firms expect the worst for the first half of the year

While manufacturers foresee environment to remain the same.

The latest Business Expectations Survey of the services sector released by the Department of Statistics showed that services firms are becoming more negative in terms of the business environment for the next six months.

A net weighted balance of 14% of firms in the services sector expects less favourable business conditions for the next six months. This is less optimistic compared to the net weighted balance of 8% registered in the previous survey.

The survey revealed that firms in the accommodation and food & beverage services industries expect slower business after experiencing brisk business during the year-end holidays. The transport & storage industry, as well as the real estate industry, is also expected the business environment to deteriorate.

Meanwhile, the Business Expectations of the manufacturing sector by the EDB Singapore points out that majority of firms at around 76% expects the business situation in the first half of this year to remain similar.

Among the manufacturing sector, the electronics cluster is the most optimistic in the next six months. This optimism is led by the semiconductor segment, which expects the current improved market conditions to continue into 2017.

In the precision engineering cluster, 2% of the firms anticipate business conditions to improve in the six months ahead. Around 4% of transport firms, on the other hand, expects the business outlook to worsen. A net weighted balance of 5% of firms in the chemical cluster expects less favourable business situation in the first half of 2017.

The general manufacturing industries cluster is the least upbeat about the business prospects, with a net weighted balance of 29% of firms predicting a softer business outlook in the months ahead.