On an annual basis, Singapore’s retail sales grew 0.9 percent, thanks to robust vehicle sales. However, on monthly basis, retail sales slowed in June from May’s upwardly revised figure. The nation’s retail sales surprisingly contracted 1.5 percent, as compared with the revised 1.5 percent growth recorded in May. June’s sequential data came in below market projections of 0.7 percent growth.
Meanwhile, on a year-on-year basis, retail sales growth slowed to just 0.9 percent in June from a revised growth of 3.2 percent in May. The year-on-year figure too came in below the market projections; however, it marked the fourth consecutive month of improvement, said OCBC Economist in a research note.
The year-on-year rise was mainly driven by a surge in motor vehicle sales that recorded growth of 17.1 percent in June. Stripping autos, retail sales declined 3 percent year-on-year, the same as in May, extending the drop to a fifth straight month, added OCBC Economist.
Weakness is noticed throughout different segments. Telecommunications & computers registered a drop of 25.1 percent, whereas petrol services stations and recreational goods recorded a drop of 14.1 percent year-on-year and 11.8 percent respectively. Weakness was also seen in wearing apparel & footwear, department stores, supermarkets, watches & jewellery and mini-marts & convenience stores. On the contrary, modest improvement was seen in furniture & household equipment and medical goods & toiletries that rose 5.8 percent and 3 percent respectively.
“Given the soft retail sentiment, easing domestic labour market conditions and post-Brexit caution, retail sales may not see a big lift from the extended Great Singapore Sale period in 3Q16,” stated OCBC Economist.
