Car sales power 5.5% increase in July retail sales

[SINGAPORE] Retail sales rose 5.5 per cent year on year in July, lifted by sales of motor vehicles, without which sales would have declined 0.4 per cent.

When comparing month on month, retail sales (seasonally adjusted) dipped marginally by 0.2 per cent in July over June. Stripping out motor vehicles, retail sales slid by 1.3 per cent.

The total retail sales value for July was estimated at S$3.2 billion, up from S$3 billion in the corresponding month a year earlier, according to a release from the Department of Statistics on Monday.

During the month of July, sales of motor vehicles surged by as much as 41 per cent year on year, while sales of department stores (5.6 per cent) and supermarkets (5 per cent) were also higher.

Meanwhile, categories which saw year-on-year falls include furniture and household equipment, which was down 6.5 per cent, as well as recreational goods, which was down 6.1 per cent. Sales of watches and jewellery dropped by 3.3 per cent.

Month on month, motor vehicle sales climbed 4.8 per cent, while that of optical goods & books increased by 3.9 per cent over June. On the other hand, sales of furniture & household equipment slumped 11 per cent while sales of wearing apparel & footwear dropped 4.9 per cent.

Retail sales growth in August could continue to be bolstered by robust motor vehicle sales as well as a pick up in tourism, especially from markets such as China, Hong Kong and Taiwan, highlighted OCBC Bank economist Barnabas Gan, who noted that arrivals from China jumped 97.4 per cent month on month in July.

"(The) LTA still received a healthy count of new motor vehicle registrations in August, suggesting that we may still see another round of strong motor sales in the August retail sales," he said. "Likewise, tourist arrivals in July recovered a strong 19.2 per cent month on month, led by a robust gain from Asia as tourists likely shed off travelling concerns after recent aircraft mishaps and as Singapore remains relatively unscathed from the ebola contagion."

Meanwhile, sales of food & beverage services dipped 1.6 per cent year on year in July, and 0.7 per cent month on month. The total sales value of F&B services for the month came to around S$627 million, down from S$637 million a year ago.