Singapore  - Singapore's key exports fell the least in 10 months in July and bounced back from a decrease in June, government data released Monday showed, suggesting that the city-state's economy was on track to recover from its worst recession in more than four decades.

In July, Singapore's non-oil exports fell a 15th consecutive month year-on-year, but the 8.5-per-cent contraction was the smallest drop since September 2008, said International Enterprise Singapore, the city-state's agency to promote external business.

In June, non-oil exports had slipped by 11 per cent year-on-year.

On a month-to-month basis, non-oil exports climbed by 6.1 per cent in July, compared to a 5-per-cent decrease a month earlier, due to higher exports of electronic and non-electronic goods.

Total trade in July reached 63 billion Singapore dollars (43.5 billion US dollars), a rise by 5.5 per cent over a month earlier, reversing a 0.5-per-cent decrease in June, the agency said.

However, compared to a year ago total trade slumped 25 per cent in July, identical to the fall in June.

All of Singapore's top 10 markets for non-oil exports except Europe and Taiwan contracted in July, with the United States being one of the largest contributors to the drop.

In July, non-oil exports to the US slumped by 24 per cent year-on-year, after a decline by just 5.3 per cent a month earlier, the agency said.

Exports to Europe showed a surprising rebound in July, climbing 9.4 per cent over a year ago, in sharp contrast to a hefty 36-per-cent drop in June.

Singapore's export-reliant economy was hit hard by the global economic downturn, but it emerged from recession with a 20.7-per-cent jump in the second quarter 2009.

But the government warned that a sustained recovery was still uncertain as there had been few signs of a decisive turnaround in demand in Singapore's key export markets.

The government expected the economy to shrink between 4 and 6 per cent in 2009.

On Sunday, Prime Minister Lee Hsien Loong said that the worst might be over for Singapore's economy, as "the eye of the storm had passed."

However, he warned that the outlook beyond the third quarter was "still not so clear." (dpa)