SINGAPORE - Retail sales edged down 2.7 per cent year-on-year in February as vehicle sales took a hit.
Excluding motor vehicles, sales were up 10 per cent from the corresponding month a year ago.
On a month-on-month, seasonally adjusted basis, retail sales rose 3.6 per cent in February but were up 7.8 per cent excluding receipts from motor vehicles.
During the month, retailers of motor vehicles reported sales slumping by as much as 39.7 per cent over February last year as car buyers shelved purchase plans on speculation that the government could refine the certificate of entitlement (COE) categorisation system to tackle sky-high COE prices.
Sales of optical goods & books, furniture & household equipment and petrol service stations registered falls of 9 per cent, 5 per cent and 4.6 per cent, respectively.
Retail sales of food & beverages, supermarkets, wearing apparel & footwear as well as department stores reported sharp spikes in sales, largely due to the Chinese New Year holidays which took place in February this year. Last year, Chinese New Year fell in January.
In particular, sales of food & beverages were up 55.9 per cent while supermarkets recorded 24.6 per cent growth in sales year-on-year and wearing apparel & footwear saw a 23.5 per cent rise in sales.
On a month-on-month basis, sales in categories such as medical goods & toiletries, telecommunications apparatus & computers, watches & jewellery and wearing apparel & footwear reported double-digit growth in February. However, sales of motor vehicles for February declined 12.3 per cent compared to January.
Citi economist Kit Wei Zheng said in a report on Monday that retail sales are likely to pick up in the coming months.
"With support from the structurally tight labour market, we would not be surprised to see year-on-year headline retail sales growth continuing to trend upwards, though volatility should be expected," he wrote.
He noted that car sales may rev up after COE premiums fell in March - following curbs to car loan financing which were announced during this year's Budget in February - while the rollout of Samsung's Galaxy S4 may also give smartphone sales a lift.
Meanwhile, sales of food and beverage services - which includes categories such as restaurants, fast food outlets and food caterers - were 7.1 per cent higher year-on-year in February but fell 0.9 per cent month-on-month (seasonally adjusted).
Get The Business Times for more stories.