Singapore’s non-oil exports unexpectedly fell from a year earlier in February, at the fastest pace in nearly 1-1/2 years, as tech product shipments continued to retreat from the hot pace of recent months and other sectors also cooled.
Exports fell 5.9 percent in February year-on-year, data from trade agency International Enterprise Singapore showed on Friday, slowing from the revised 12.9 percent rise the month before and falling significantly short of the 4.4 percent increase predicted by economists in a Reuters poll.
This was the biggest on-year decline since October 2016, when exports fell 14.0 percent, Reuters data shows.
The pullback was due in part to the effects of the Lunar New Year holidays, which took place in February this year, resulting in fewer business days for the month than February last year. In 2017, the holidays were in January.
On a seasonally adjusted month-on-month basis, exports contracted 2.6 percent after contracting a revised 0.4 percent in January. The poll predicted a 0.3 percent contraction.
February’s slump was due to a 12.3 percent drop in electronics, the third straight month of decline for the sector.
The city-state posted its fastest economic expansion in three years in 2017 on the back of stellar growth in the electronics sector, which benefited from the boom in global demand.
Analysts and policymakers already expect a moderation of electronics exports, but factors like the Lunar New Year amplified the cooling of the sector.
“We are not going to make much of NODX data in January and February given the host of volatility introduced by the Lunar New Year,” said Mizuho bank economist, Vishnu Varathan.
Singapore’s exports had surged in January 2018, thanks to a jump in sales of petrochemical products, which offset a decline in electronics shipments and indicated trade growth was broadening across the sectors.
But petrochemical exports – which are known to be volatile – also fell in February at 12.9 percent from the year before.
“We probably need to get a more aggregated data for Q1 as a whole and try to make sense of things,” Varathan said.