At the end of the latest round of bidding on Wednesday, COE premiums closed substantially higher across the board.

The COE price for cars up to 1,600cc climbed 18.2 per cent to close at $11,690, while the premium for cars above 1,600cc shot up by 29.5 per cent to hit $11,889. The Open category price was 28.1 per cent higher at $12,901.

The COE price for commercial vehicles followed suit, rising by 27.5 per cent to finish at $9,690. The motorbike premium posted the most modest gain of 9.8 per cent, to $889.

The double-digit increases were the sharpest in recent memory, sending premiums to an eight-month high - back to when the global financial meltdown started to gain momentum in October.

Motor traders were bracing themselves for an increase, but the big jumps caught them by surprise.

Cycle & Carriage's general manager (Mitsubishi) Alvyn Ang put it mildly when he said Wednesday's results were 'a bit higher than expected'.

Besides the smaller COE supply which kicked in in April, industry players said consumer demand has also improved in recent weeks.

Mr Ang of Cycle & Carriage said: 'The market is coming back. Buying sentiment has definitely improved.

'There is now less window-shopping, and more genuine buyers.'

Read the full story in Thursday's edition of The Straits Times.