Singapore business confidence hits one-year low for Q1 2023: SCCB
Vivienne Tay
LOCAL business sentiment has moderated for the fourth straight quarter, hitting a one-year low for the first quarter of 2023, amid a mixed outlook across various sectors.
Data from the Singapore Commercial Credit Bureau (SCCB) released on Tuesday (Dec 13) showed its quarterly Business Optimism Index falling to +4.73 percentage points for Q1 2023 from +4.98 percentage points the previous quarter and +5.91 percentage points in Q1 2022.
Similar to the fourth quarter, five out of six indicators remained expansionary. These indicators are volume of sales, net profit, selling prices, new orders, inventory levels and employment.
However, only one of the indicators saw an improvement quarter on quarter, compared with three out of six in Q4 2022. This indicator was net profit, which increased to +0.75 percentage point from zero percentage point the previous quarter.
Volume of sales dropped to +2.24 percentage points in Q1 2023 from +2.99 percentage points in Q4 2022, while selling prices fell to +8.96 percentage points from +9.70 percentage points. New orders declined to +9.70 percentage points from +10.45 percentage points, while employment levels dipped to +8.21 percentage points from +8.96 percentage points.
Year on year, the volume of sales, net profit, new orders, inventory levels and employment levels were down. However, selling prices increased.
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Sentiments within the transportation and construction sector were upbeat, with all six indicators in positive territory. The financial and services sectors were mostly upbeat as well, with five of six indicators positive.
Business confidence among manufacturers, however, moderated strongly, with only three of six indicators in positive territory. Similarly, the wholesale sector remained muted, with half its indicators in negative territory.
“Business sentiments have dampened further primarily due to the ongoing downside risks from geopolitical uncertainties, higher inflationary risks and a deterioration in external demand conditions, specifically the wholesale trade sector,” said SCCB chief executive Audrey Chia.
She expects growth prospects for sectors such as transportation and services to remain positive in 2023, and externally-oriented sectors to remain subdued.
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