Singapore’s retail sector experienced a notable boost in July and August, with sales increasing by 0.5% month-on-month in August, following a robust 3.9% rise in July. This growth translated to a year-on-year increase of 5.2%, marking the strongest performance since February 2024, according to UOB Global Economics and Markets Research.
The surge in retail sales was largely attributed to a significant influx of tourists, particularly from China, which reached 103% of 2019 levels during the summer school holidays. This was complemented by a decline in outbound travel by Singapore residents, as the school term resumed, bolstering domestic spending. Categories such as furniture and household equipment, recreational goods, wearing apparel and footwear, and cosmetics saw substantial growth.
Additionally, supermarkets, mini-marts, and convenience stores maintained strong sales, partly due to the SG60 vouchers distributed in July, which are expected to continue influencing consumer spending into September and October.
Looking ahead, UOB remains cautious about sustaining this momentum, citing potential challenges from a cooling labour market. The Ministry of Manpower’s Net Employment Outlook for Q3 2025 showed a slight decline, indicating potential slowdowns in hiring and wage growth, which could impact consumer sentiment. However, October may see a temporary boost in retail sales from events like the Formula 1 Singapore Grand Prix and increased tourist arrivals during China’s Golden Week holiday.
