Singapore: Outlook for Retail Sales remains positive – UOB

Senior Economist at UOB Group Alvin Liew reviews the recently published retail sales readings in Singapore.

Key Takeaways

Singapore’s retail sales rose in line with expectations, by 1.8% y/y in May (easing from a revised 3.7% y/y in Apr) versus the Bloomberg median estimate of 1.9% y/y. On a seasonally-adjusted sequential basis, retail sales fell by -0.2% m/m (from +0.5% m/m in Apr).  Excluding motor vehicle sales, the sequential decrease was slightly worse at -0.4% m/m, but it still translated to a 1.8% y/y increase in May (from a revised 4.3% y/y in Apr).  Despite the less robust headline growth in May (compared to Apr), retail sales value was higher at S$4.03bn in May, from S$3.90bn in Apr. 

Outlook – We continue to expect domestic retailers to enjoy domestic and external supports, complemented by major events such as various sports, high profile concerts and BTMICE (Business Travel and Meetings, Incentive Travel, Conventions and Exhibitions) activities which will help anchor further improvement in leisure, business travel and inbound tourism, while strong employment and wage growth conditions in Singapore will likely contribute further to domestic consumption demand.