Singapore's non-oil domestic exports fell 20.6 percent on the year in December after dropping 14.6 percent in November and fell 3.3 percent on the month after a previous decline of 9.2 percent. Imports fell 8.2 percent on the year in November, weakening sharply from no change in November, and fell 3.0 percent on the month after dropping 7.0 percent previously.

Weak headline growth in exports was broad-based across categories. Electronic exports fell 17.9 percent on the year in December after dropping 20.2 percent in November, while non-electronics exports fell 21.3 percent after a previous decline of 12.8 percent. Growth in exports to the European Union fell after a previous increase while exports to the United States, China, Hong Kong and Taiwan all recorded large falls, partly offset by increases in exports to Japan and South Korea.

Singapore publishes monthly data (both in nominal and real terms) for the current and previous two months, cumulative-to-date data on imports and exports by country of origin and destination, as well as monthly seasonally adjusted trade data. Imports refer to goods brought into Singapore irrespective of whether they are for consumption, for processing, for use in manufacturing, or for subsequent re-shipment to other countries/areas. Exports refer to goods brought out of Singapore. They comprise domestic exports and re-exports. Data are also disseminated on imports broken down by country of origin and domestic exports and re-exports broken down by country of destination.

Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they also affect currency values in foreign exchange markets. However, the foreign exchange impact is muted here given that Singapore’s currency is managed by the central bank.

Imports indicate demand for foreign goods and services in the local economy. Exports show the demand for local goods in countries overseas. Movements in the trade balance directly affect GDP growth because of the Singapore’s dependence on trade. Stronger exports are bullish for corporate earnings and the stock market. The bond market is also sensitive to the risk of importing inflation.

This report also gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.