Two ugly charts blamed for downward revision of trade growth targets

The sharper-than-expected 7.9% NODX rebound in Oct is found insignificant.

After an average 7% yoy fall in the previous two months, NODX recovered to grow by 7.9% in Oct, ahead of consensus and our forecasts of +3.1% and +4.0% yoy respectively. The rebound was aided by a sharp yoy fall in Oct 11 (-16.3% yoy). Both tech and non-tech DX fared better than expected. Led by drugs (+2.7% in Oct vs. Sep’s -3.0%) and supported by lumpy exports (106% yoy in Oct, 127% in Sep), non-tech DX rose 12.7% yoy (3.9% in Sep), the strongest in eight months.

CIMB however notes that despite this positive development, Singapore has actually lowered its 2012-13 trade and NODX forecasts. Total trade is projected to expand 3-4% this year vs. its previous forecast of 4-5% (10M12: 2.1%). 2012 NODX growth has been lowered to 2-3% from 4-5% (10M12: 2.7%).

For 2013, citing subdued global demand, NODX growth is projected at 2-4% while total trade is expected to expand by 3-5%