THE annual Great Singapore Sale in June has failed to lift retail sales as subdued growth in the region took a toll on retailers here.
Retail sales fell 0.9 per cent compared with a year earlier, reversing a 0.6 per cent rise in May. The figure also fell short of a 0.1 per cent gain expected by 10 economists surveyed by Bloomberg.
Some specialist retailers did very well, though it was not enough to lift the wider sector.
Retailers of medical goods and toiletries, telecommunications apparatus and computers, and supermarkets enjoyed sales hikes of between 10.7 and 17.8 per cent.
Retail sales of apparel and footwear were up 1.2 per cent, and the sale of recreational goods added 4.9 per cent year-on-year.
A 10.8 per cent slump in car sales was the main drag on overall June retail sales. Sale of watches and jewellery slid 9.2 per cent.
After stripping out car sales, retail sale figures for June increased 2.3 per cent.
Barclays economist Leong Wai Ho noted that the weakness in retail sales comes as no surprise, as private consumption growth decelerated to 1.8 per cent in the second quarter compared with the same period a year earlier.
He said: "Despite the tight labour market and an improvement in job creation, local consumers turned more cautious in the second quarter amid rising uncertainty about growth and a drop in the equity market... In addition, tourist arrivals slipped 0.4 per cent in April to May compared with the first quarter."
OCBC economist Selena Ling said that with China's growth likely to continue to moderate, visitor numbers from the country could be more subdued over time.
However, one bright spot in the coming months is the annual F1 race in September.
Ms Ling said: "If you look at some of the business expectation surveys, the more upbeat sectors are the hotel sectors, but generally, retail sales will move in tandem with the broader macro slowdown story."