Thailand
Singapore business sentiment moderates slightly in Q2 on global uncertainty: SCCB
BUSINESS confidence among local businesses has dipped slightly in the second quarter of 2022, amid global uncertainties including geopolitical tensions and continued supply chain disruptions, said the Singapore Commercial Credit Bureau (SCCB) on Tuesday (Mar 15).
Its quarterly Business Optimism Index (BOI) had dipped slightly on quarter, down to +5.35 percentage points in Q2 from +5.91 percentage points in Q1, although BOI rose from +3.94 percentage points in Q2 2021, and remains above pre-pandemic levels in 2019.
Of 6 indicators – which include volume of sales, net profit, selling prices, new orders, inventory levels and employment – only 1 experienced improvements on quarter, as compared to 3 indicators in Q1.
In Q2, selling prices increased to +5.22 percentage points from +3.73 percentage points in Q1. Meanwhile, new orders saw the biggest dip, dropping to +5.22 percentage points in Q2 from +10.45 percentage points in Q1.
On quarter, volume of sales fell to +2.99 percentage points from +3.79 percentage points, net profits dropped to +2.99 percentage points from +4.58 percentage points, while employment levels dipped to +11.94 percentage points from +13.53 percentage points.
Inventory levels also remained contractionary at -1.49 percentage points in Q2 from -0.75 percentage points in Q1.
On a year-on-year basis, however, employment levels jumped from 0 percentage point, while inventory levels increased from -7.64 percentage points in 2021. Meanwhile, both volume of sales and net profits moderated visibly from +9.92 percentage points in 2021.
Commenting on the results, SCCB chief executive Audrey Chia said the ongoing conflict in Ukraine will likely pose downside risks in the short-to-medium term on global supply chains, which have already been in a fragile state since the start of the pandemic.
“However, growth prospects for domestically-oriented sectors remain strong with the progressive easing of safe management measures and travel restrictions. Hence, we expect the overall outlook of firms to remain cautiously optimistic in the next quarter,” she said.
By sector, SCCB noted that the outlook for the financial and manufacturing sectors are most optimistic in Q2, with both sectors having all 6 indicators in positive territory, while the mining sector is most downbeat in the quarter, with all 6 indicators in negative territory.
The services sector “remained relatively upbeat”, with 4 indicators in positive territory, and the transportation sector has seen an improvement in sentiments, with 3 indicators in positive territory.
As for the construction sector, it remained muted with only 2 indicators in positive territory, although it did record a jump in selling prices and new orders, while the wholesale sector remained “lukewarm” with the majority of indicators unchanged.
The Ministry of Trade and Industry has projected Singapore’s gross domestic product growth to come in at 3 to 5 per cent in 2022.
Source: https://www.businesstimes.com.sg/sme/singapore-business-sentiment-moderates-slightly-in-q2-on-global-uncertainty-sccb