Singapore business sentiment improves slightly but construction and transportation stay gloomy: Survey

SINGAPORE – Local companies’ business confidence for the third quarter improved marginally amid an upbeat outlook for the financial, manufacturing and wholesale sectors, according to a survey out on Monday (June 14).

However, the outlook for the construction and transportation sectors remained downbeat.

The overall Business Optimism Index (BOI) rose to +4.07 percentage points for the July-August period, said the Singapore Commercial Credit Bureau (SCCB) that compiles the index every quarter.

The BOI was up from +3.94 percentage points in the second quarter when the index climbed into the expansionary zone after staying in the contractionary zone for four straight quarters, said SCCB, a subsidiary of Credit Bureau Asia.

Ms Audrey Chia, SCCB’s chief executive officer, said the recently imposed heightened alert measures and stricter border controls aimed at containing the resurgence of Covid-19 have dampened the outlook for construction, transportation and certain segments within the consumer-facing services sector.

“Given the lingering uncertainties in the pandemic both locally and globally, we foresee the outlook to remain mixed and uneven across different sectors,” she said.

Moving into the third quarter, firms will have to brace themselves for more downside risks ahead, Ms Chia noted.

The index measures business sentiment in the economy by tracking six parameters: volume of sales, net profit, selling price, new orders, inventory levels and employee count.

SCCB said three of the indicators improved from the previous quarter when all the six indicators had moved up.

Volume of sales and net profit moderated to +7.63 percentage points from +9.92 percentage points in the second quarter.

Selling price rose to +2.29 percentage points from +1.53 percentage points.

New orders remained unchanged at +9.92 percentage points, while inventory levels inched upwards to -6.11 percentage points from – 7.64 percentage points.

Employment levels increased to +3.05 percentage points from nil in the second quarter.

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