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Barnabas Gan, Economist at UOB Group, reviewed the latest retail sales figures in Singapore.

Key Quotes

“Singapore retail sales plunged by another 52.1% y/y in May 2020, a record pace of contraction since data was made public in 1985. Excluding motor sales, retail sales fell 45.2% y/y in the same month.”

“The decline was led primarily by the circuit breaker measures which spanned between 7 April and 1 June, to contain the COVID-19 outbreak. With many retail stores shuttered due to the circuit breaker, departmental stores sales fell 93.4% y/y in May 2020 while sales of consumer discretionary goods plummeted.”

“On the flip side, online sales as a share of total retail sales surged to an all-time high of 24.5% since data was available as of 2018. This translates to a strong 125.6% y/y increase in online retail sales.”

“We expect the resurgence of pent-up retail demand in the coming months, given that Phase Two reopening as of 19 June had allowed most retail outlets to start reopening. Dine-in options for food outlets and restaurants were also allowed in Phase Two, suggesting that the food and beverage sales will likely pick up as well. In all, these will likely translate to a recovery in month-on-month growth rates for overall retail sales especially for June 2020. For the full year, we keep our retail sales outlook at -5.0% in 2020 with downside risks.”