Economists remain upbeat about NODX growth despite July’s likely one-off surge

NODX grew 15.7% YoY in July.

Despite July's 15.7% growth likely being a one-off, non-oil domestic exports have shown an upward trend, leaving economists optimistic about Singapore's performance for FY 2024.

For the year, CGS International economists project a 3.4% growth in NODX, citing favourable prospects in the pharmaceutical sector and significant adjustments in shipping costs.

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In July, the pharmaceutical sector recorded a 4.0% YoY increase.

meanwhile,  CGS International economists said  Although shipping rates are still relatively high on yoy basis they have moderated on a mom basis, declining fromUS$5,937.37 on 18 July to US$5,428.02 on 15 August.

The economists added that financial markets worldwide have adjusted to anticipate four rate cuts by the US Federal Reserve this year, up from the earlier expectation of just one.

"This shift could lead to a broader trend of lower interest rates globally, potentially boosting global consumption which in turn would spur global trade," CGS International economists said.

Still, the economist warned that geopolitical tensions, particularly the Israel-Hamas conflict, could disrupt global growth and trade due to potential sanctions.