Singapore’s retail sales fell for an eighth month in May as jobs losses, wage cuts and fewer tourist arrivals depressed spending.
The retail sales index dropped 10.3 percent from a year earlier, after sliding a revised 11.4 percent in April, the Statistics Department said today. The median estimate of 11 economists surveyed by Bloomberg News was for a 10.6 percent decline. Adjusted for seasonal factors, sales rose 0.8 percent from April.
Singapore’s services industries have shrunk for three straight quarters, weakening an economy that is forecast to contract as much as 6 percent this year. Visitor arrivals to the island have slumped as the global slowdown curbs business and holiday travel, hurting sales at companies such as Singapore Airlines Ltd. and FJ Benjamin Holdings Ltd.
“We expect retailers to remain under pressure from cautious consumer sentiment and sharp price discounts offered by competitors,” said Alvin Liew, an economist at Standard Chartered Bank in Singapore. “Expect sales of big-ticket items like cars to remain weak, while petrol sales are still on the decline.”
Singapore’s tourist arrivals were 11.7 percent lower in the first five months of 2009 compared with a year earlier. The drop in visitors is weighing on the hotel and restaurant industries, the government said yesterday.
Average hotel room rates dropped 25 percent in May from a year earlier to S$184 ($126), while occupancy in hotels fell 12.2 percentage points to 69 percent in May, according to the Singapore Tourism Board.
Singapore Air, the world’s second-largest airline by market value, has cut salaries and enforced fewer working days for its employees to reduce costs. Singapore Press Holdings Ltd., the city state’s biggest newspaper publisher, lowered wages for 3,000 employees by as much as 10 percent and reduced bonuses.
Purchases of apparel and footwear slipped 8.6 percent in May while sales of furniture and household equipment declined 6.6 percent from a year earlier. Sales at gas stations dropped 22.2 percent as crude oil prices at the end of May were about 48 percent lower than 12 months earlier.
Vehicle sales fell 23.8 percent in May from a year earlier, today’s report showed. There were 6,035 new cars registered in May, compared with 8,363 vehicles for the same month in 2008, according to the Land Transport Authority.