Singapore retail sales rose at more than twice the expected pace in August as shoppers bought more goods at department stores and more cars, showing that consumer sentiment was resilient to the United States sub-prime mortgage crisis.
The retail sales index jumped 6.7 per cent from that of a year ago, after falling a revised 1.9 per cent in July, the Department of Statistics (DOS) said, topping estimates in a Bloomberg survey of 10 economists, in which the median forecast was a 2.6-per-cent rise. Excluding vehicles, sales gained 8 per cent.
Singapore’s longest economic expansion since 1991 is contributing to rising employment and higher salaries, boosting consumer confidence and spending even after the Government raised the Goods and Services Tax by 2 percentage points to 7 per cent in July.
Employers added a record number of workers in the second quarter, pushing the unemployment rate to the lowest in six years.
“The strong economy and jobs market have allowed consumers to quickly rebound from the GST impact,” said Mr Song Seng Wun, an economist at CIMB-GK Securities.
According to the quarterly ING Investor Sentiment Tracking Study results, 55 per cent of investors in Singapore have a positive outlook on the economic situation for the next three months.
Overall retail sales in Singapore rose 0.7 per cent in August from July, the DOS said. Excluding cars, the index fell 1.9 per cent from a month ago. Adjusted for seasonal factors, August retail sales increased 8.7 per cent from July. Excluding cars, the index advanced 1.4 per cent. Department store sales jumped 11.6 per cent in August from that of a year ago, staying unchanged from the previous month.
Vehicle sales in August increased 3.7 per cent from the corresponding month a year ago. From the previous month, vehicle sales gained 7.1 per cent. The number of newly-registered motor vehicles rose 3.8 per cent to 10,713 in August from a month earlier, according to the Land Transport Authority.