, Singapore

Retail sales hit record-breaking 54.0% growth but still below pre-COVID levels

The record-breaking growth was due to a much lower base in April last year, the start of the Circuit Breaker period.

Retail sales surged by 54.0% in April, owing to the low base of April last year, according to latest government data.

Excluding motor vehicles, total retail sales increased by 39.2%.

Total retail sales value for the month was $3.3b, or $2.8b excluding motor vehicles.

Online sales made up 11.2% of that sales value, or 13.3% excluding motor vehicles.

This is a massive increase from the -55.3% recorded in April last year, the beginning of the Circuit Breaker period. However, sales figures still fall below pre-COVID levels, when physical stores were closed for most of the month.

All retail industries recorded significant year-on-year increases, except for mini-marts & convenience stores and supermarkets & hypermarkets, which fell by 16.8% and 30.2% respectively.

Watches & jewelry saw the highest growth, with a whopping 646.8% increase in sales, followed by wearing apparel & footwear by 442.6%, department store sales by 278.8% and motor vehicle sales by 261.3%. Also recording triple-digit growth were recreational goods (174.6%), petrol service stations (103.8%), optional goods & books (101.4%) and other goods (103.1%).

“A mix of improving consumer demand and a low base observed in April 2020 were key drivers for the record high growth. Retail sales plummeted 40.0% y/y in April 2020, given the implementation of circuit breaker (7 April – 1 June 2020),” said UOB economist Barnabas Gan.

He added that the implementation of Phase Two and Phase Two (Heightened Alert) would only have a transitory impact on retail sales in the coming months.

“Retail demand is expected to take a negative knock-on effect from the stricter social distancing measures in May and June’s retail sales reading, although it should still register positive year-on-year growth during those months,” Gan said.

OCBC economist Howie Lee called the April retail sales figure “mind boggling” but lower than OCBC’s 60.4% forecast.

Moving forward, Lee said retail sales growth for the rest of the year will be sluggish.

Even if Singapore manages to return to Phase 3 as scheduled, the continued restrictions on movement as well as lack of tourist arrivals mean retail sales for the rest of 2021 will likely be sluggish,” Lee said. “The on-off virus outbreaks globally and regionally will continue to rear its head and caps any strong

recovery momentum from a sector that is typically dependent on high human density and turnover.”

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