LOCAL business sentiment continued on an upward trend for the fifth consecutive quarter, hitting a two-year high in the fourth quarter of 2024.
Data released by the Singapore Commercial Credit Bureau (SCCB) on Monday (Sep 9) showed that the Business Optimism Index rose marginally to +5.06 percentage points in Q4, from +4.94 percentage points in Q3.
On the year, the index for the quarter was also higher than the +4.35 percentage points recorded in Q4 2023.
Similar to the previous quarter, indicators of sales volume, net profit, selling price, new orders and employment level stayed expansionary. Meanwhile, inventory level rebounded to zero percentage point in Q4 2024 from -1.48 percentage points in Q3 2024.
Three of the six indicators improved on a quarter-on-quarter basis, namely sales volume, net profit and inventory level, while selling price and new orders moderated.
Employment level fell to +5.93 percentage points in Q4, from +6.67 percentage points in the previous quarter.
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On the year, both sales volume and net profit climbed to +7.41 percentage points in Q4 2024, from +3.73 percentage points and +2.24 percentage points, respectively.
Inventory level for Q4 2024 stood at zero percentage point, recovering from the -2.24 percentage points recorded in the previous year.
New orders moderated to +2.96 percentage points in the latest quarter, down from +3.73 percentage points in Q4 2023.
Selling price fell to +6.67 percentage points in Q4 2024 from +11.19 percentage points in the year before, while employment level dipped to +5.93 percentage points in the latest quarter from +7.46 percentage points in the prior year.
SCCB noted that the financial, construction and transportation sectors were the most optimistic, with at least five out of six indicators in positive territory.
Sentiments within the manufacturing sector improved slightly, with only two of six indicators in positive territory. Both volume of sales and net profit rebounded from the contractionary zone to zero percentage point in Q4 2024, from -3.85 percentage points in Q3 2024.
The outlook for both the wholesale and services sectors remained positive, with three of six indicators positive.
SCCB chief executive officer Audrey Chia expects a brighter quarter ahead for local firms.
She added that the relatively upbeat outlook by local firms was largely due to strong growth prospects within the financial, construction and transportation sectors.
“Despite experiencing slight contractions in the recent months, the manufacturing sector has also shown signs of a possible recovery in the final quarter of 2024,” she said. “However, we would still caution on the geopolitical and economic downside risks globally.”
