Singapore’s retail sales grew by 4% year-on-year in August, an increase from the revised 1.3% growth seen in July, according to the Department of Statistics (Singstat). This growth marks the seventh consecutive month of retail expansion and significantly exceeds the median estimate of 0.9% from private-sector economists polled by Bloomberg.

On a month-on-month basis, retail sales increased by 1.7%, building on the revised 0.8% growth from July. The total estimated retail sales value for August reached S$4 billion, with online sales contributing 12.2% of this total. When excluding motor vehicles, retail sales still grew by 3.7% year-on-year, marking the 18th month of continuous expansion.

OCBC chief economist Selena Ling highlighted that the retail sales performance in August was the strongest since March 2023, with figures excluding automobiles also showing the highest levels since April 2023. The growth has been attributed to the return of overseas visitors, with DBS economist Chua Han Teng noting that visitor arrivals in August 2023 were at 75% of the levels observed in August 2019.

Despite a seasonal dip in visitor arrivals to 1.31 million in August from 1.42 million in July, economists remain optimistic about the potential for further recovery as flight capacities increase, especially from China, which has seen arrivals reach 33% of pre-pandemic levels.

Major events, including sports, concerts, and business travel activities, alongside potential frontloading of purchases before the upcoming Goods and Services Tax hike in January 2024, are expected to support continued retail growth.

Most retail categories recorded year-on-year growth in August, with food and alcohol emerging as the strongest category due to the increase in international travel. Sales of food and beverage services rose by 8.6%, surpassing the 6.6% growth seen in the previous month. Growth was recorded across all segments, including:

Restaurants: 5.3%
Fast food outlets: 7.8%
Food caterers: 29.8%
Cafes and food courts: 7.7%
Overall, food and beverage services receipts totaled S$1 billion, with online sales estimated at 23.1%.