Singapore retail sales reverse decline with 3.2% rise in May

20130717-st-sg-retail-sales-reverse-decline-3.2-percent-rise-in-may-pic SHOPPERS in Singapore kept the tills ringing in May to push retail sales to the highest rise in nine months, as they splashed out more on cars, smartphones and other goods.

Retailers rang up 3.2 per cent more in sales in May over the same month last year, according to the latest retail sales index released by the Statistics Department yesterday.

This reversed a 0.3 per cent decline in sales in April.

The hike in consumer spending also helped support the wider economy, which grew a stronger-than-expected 3.7 per cent in the second quarter over a year ago, partly boosted by a robust performance in the wholesale and retail trade sector, the Trade and Industry Ministry said last Friday.

With unemployment low, Singapore's consumers are likely to keep spending, providing a "cushion" for economic growth in the coming months, said Citi economist Kit Wei Zheng.

Apart from petrol service stations and sellers of furniture and household equipment, all other retailers logged higher year-on-year sales last month, the Statistics Department said.

In particular, consumers spent 8.1 per cent more on telecommunications apparatus and computers in May compared with a year ago. This was likely due to the launch of the Samsung Galaxy S4 smartphone in that month, suggested Citi's Mr Kit.

Shoppers also spent 7.2 per cent more on watches and jewellery, 7.1 per cent more on supermarket shopping, and 6.1 per cent more on food and beverages.

On a month-on-month basis, retail sales increased as well, rising 2.1 per cent in May compared with April, data showed.

This was led by a jump in sales of telecommunications apparatus and computers, motor vehicles and department store goods.

Sales of motor vehicles such as cars, which have been responsible for the wild swings in retail sales data in recent months, rose 3.5 per cent in May over a year ago and 5.1 per cent over April.

The year-on-year growth for car sales was the first in four months, noted Mr Kit.

He said buyers of luxury cars had reportedly brought forward their purchases on fears that rules would be tweaked to differentiate certificates of entitlement (COEs) for luxury and mass market cars. Such a change might lead to higher COE prices for luxury cars.

"Car sales were likely also spurred by the suggestion that surcharges on multiple car ownership could be imposed," he added.

Excluding motor vehicles, retail sales would have risen 3.1 per cent in May over a year ago and 0.9 per cent in May over April, the Statistics Department said.

fiochan@sph.com.sg

Source: Straits Times, 17 Jul 2013