Singapore retail sales drop on fewer purchases of cars, jewelry

August 15, 2008
Singapore Democrats

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Shamim Adam
Bloomberg

Singapore’s retail sales fell for the first time in four months as vehicles sales slumped and consumers bought fewer luxury goods, mobile phones and computers.

The retail sales index fell 3.2 percent from a year earlier, after climbing 4.8 percent in May, the Statistics Department said today. That was worse than the median forecast for a 0.2 percent decline in a Bloomberg News survey of 10 economists. Excluding vehicles, sales dropped 0.8 percent.

Singapore’s tourism arrivals have eased as the island’s dollar appreciated, and the number of visitors in June dropped the most since the SARS outbreak five years ago. The government last week lowered its 2008 growth forecast as the highest inflation rate in 26 years leaves consumers with less to spend.

“Car sales have been weakening around the world as oil prices rose, and it’s not surprising to see the same in Singapore as well,” said David Cohen, director of Asian Forecasting at Action Economics in Singapore. “Retail sales are not expected to pick up very much in the second half.”

Adjusted for seasonal factors, retail sales in June were unchanged from May. Excluding cars, the index fell 2.2 percent from June, the government said.

Vehicle sales in June declined 8 percent from the same month in 2007. From May, auto sales rose 6.8 percent, without adjusting for seasonal factors.

Sales at gas stations in Singapore jumped 27 percent in June from a year earlier, and dropped 4.1 percent from the month before, today’s report showed. The government doesn’t subsidize fuel, prompting oil companies to pass on rising costs to motorists.

Purchases at supermarkets grew 8.4 percent from a year earlier, and slipped 5.4 percent from the previous month. The Southeast Asian city state of 4.6 million people imports about 90 percent of its food.

Department-store sales gained 5 percent in June from the same month in 2007, and dropped 4.5 percent from May.

Purchases of furniture and household equipment slid 10 percent from a year earlier. Apparel and footwear sales rose 2.8 percent and those of watches and jewelry declined 21.8 percent.

http://www.bloomberg.com/apps/news?pid=20601080&sid=apDm9Pz2oS.U&refer=asia