Singapore retail sales extend decline for second straight month, dip 2.9% in December
Economists attributed the drop to more Singaporeans travelling abroad during the year-end holiday season
SINGAPORE’S retail sales dipped 2.9 per cent year on year (yoy) in December, extending the revised 0.5 per cent decline posted in the month before.
December’s figures fell short of estimates by private-sector economists, who had expected retail sales to grow 1 per cent yoy in a Bloomberg poll.
They attributed the drop to increased local outbound travel during the year-end school holiday season, which resulted in weaker discretionary spending.
This was the second straight month retail sales declined and the index’s worst performance since February 2022, noted OCBC chief economist Selena Ling.
DBS economist Chua Han Teng said: “Near-term retail sales numbers could be volatile due to statistical variations arising from the timing of Lunar New Year festivities in 2025, compared to 2024.”
But things could pick up as outbound travel normalises and labour market conditions remain resilient in the near-term, he said. This could “offer some relief” from the retail sales weakness in 2024’s final two months.
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On a month-on-month, seasonally adjusted basis, retail sales slid 1.5 per cent, extending November’s 2.8 per cent decline, Department of Statistics (SingStat) data released on Wednesday (Feb 5) showed.
December’s total retail sales came in at S$4.6 billion. Online sales accounted for 13.4 per cent, compared with 14.7 per cent for November, amid major online shopping events.
Excluding motor vehicles, retail sales dipped 4 per cent from the year-ago period, and posted a sequential drop – down 3.5 per cent on a month-on-month, seasonally adjusted basis.
Nine of 14 retail sales categories recorded year-on-year declines in December.
Ling expects retail sales to expand around 2 per cent yoy in 2025, compared to the 1.2 per cent growth in 2024, and 2.3 per cent in 2023.
This could be driven by increased tourist arrivals in Singapore, resilient domestic labour market conditions that “should underpin domestic consumption”, as well as a higher Certificate of Entitlement quota, she said.
“That said, the key risk for the retail sector pertains to the external headwinds with the challenging trade environment, which may dampen market sentiments in the near-term and contribute to some belt-tightening should the local labour market soften gradually.”
On a month-on-month, seasonally adjusted basis, sales declined for 10 of the categories. Wearing apparel and footwear posted the largest sequential fall of 11.6 per cent; motor vehicles posted the largest sequential gain of 13.2 per cent.
Sales of food and beverage (F&B) services rose 1 per cent yoy, less than the 4 per cent expansion posted in November. It was down 2.2 per cent on a monthly, seasonally adjusted basis, compared with the 1.8 per cent decline the previous month.
On the year, growth was recorded across restaurants (0.2 per cent); fast food outlets (1.4 per cent); and food caterers (16.7 per cent). Cafes, food courts and other eating places fared less well, falling by 2.7 per cent.
On a month-on-month, seasonally adjusted basis, only fast food outlets recorded growth, at 0.8 per cent. The rest posted falls: restaurants (-1.5 per cent); food caterers (-3.3 per cent); and cafes, food courts and other eating places (-3.7 per cent).
F&B services receipts amounted to S$1 billion, with online sales accounting for an estimated 24.8 per cent of this sum.
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