Singapore retail sales rebound in February on CNY boost, but outlook clouded by Iran war
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Chinese New Year gave a year-on-year lift to retail sales in February, reversing January’s decline, though a month-on-month pullback could be flagging slowing growth.
ST PHOTO: SHINTARO TAY
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SINGAPORE – Retail sales in February rebounded with Chinese New Year spending after January’s decline, but the cheer will likely not last as the Middle East conflict that has broken out since drags on.
Takings at the till rose 8.3 per cent year on year in February, after edging down a revised 0.5 per cent in January, according to data from the Singapore Department of Statistics (DOS) released on April 6.
The increase was partly owing to the timing of the Chinese New Year holiday, which fell in February in 2026, as opposed to January in 2025, DOS said.
Excluding motor vehicles and parts and accessories, retail sales grew 11.2 per cent year on year, rebounding from a 2.9 per cent decline in January.
“The robust performance was boosted by Chinese New Year-related festive spending, with notable double-digit increases in seven out of 14 key retail categories,” said DBS senior economist Chua Han Teng.
But month on month and seasonally adjusted, retail sales fell 4.1 per cent from January.
Ironing out the differences in Chinese New Year timing, for the first two months of 2026, retail sales rose 3.5 per cent year on year, while food and beverage (F&B) sales increased 1 per cent over the same period.
“Retail sales are likely to remain volatile in the near term, reflecting the typical swings observed in the first quarter of the year around the Chinese New Year period,” said Mr Chua.
He added that while sales may be supported by a resilient labour market, downside risks – including inflationary pressures from the ongoing Middle East conflict – should be monitored.
“(It) could ultimately weigh on consumers’ purchasing power and curtail retail sales,” he said.
Mr Song Seng Wun, an economic adviser at SDAX, said: “The initial impact of the war in the Middle East is most immediately visible in petrol and transport-related costs, and this will gradually trickle through to retail prices in the months to come.
“Higher transportation costs will feed into the costs of, for example, goods sold at supermarkets, minimarts and hypermarkets. It is a question of when and how much is passed on.”
Mr Song noted that energy-driven cost pressures will show up more clearly in subsequent months if fuel prices remain elevated.
He added that consumer behaviour changes may not be immediate, but will become more visible in the second half of the year as businesses are likely to adjust prices.
In February, total retail sales came to $4.2 billion, with online transactions accounting for 14.1 per cent of the total.
Most retail segments recorded year-on-year growth, led by supermarkets and hypermarkets, where sales jumped 29.3 per cent.
Recreational goods and department stores also posted gains of 26 per cent and 16.8 per cent respectively.
In contrast, petrol service stations saw sales fall 9.8 per cent, while sales of motor vehicles, parts and accessories dropped 7.8 per cent.
Month on month, February retail sales declines were broad-based. Sales of wearing apparel and footwear dropped 14.4 per cent; watches and jewellery fell 13.9 per cent; and minimarts and convenience stores fell 13.8 per cent.
UOB Global Economics and Markets Research said retail sales recorded a seasonally adjusted 4.1 per cent month-on-month pullback in February, likely reflecting front-loaded purchases ahead of Chinese New Year.
“Sequential declines were observed in nine out of 14 sub-categories,” it said, adding that retail sales are likely to face headwinds for the rest of 2026, as rising energy prices and geopolitical tensions weigh on consumer sentiment and broader demand.
Sales of F&B services in February were also boosted by festive spending, climbing 5.5 per cent year on year and reversing a 3.2 per cent decline in January.
Sales at restaurants and food caterers grew 9.2 per cent and 12.6 per cent respectively, while fast-food outlets and cafes saw more modest increases.
However, foodcourts and other eating places recorded a 4.4 per cent decline in sales.
On a month-on-month and seasonally adjusted basis, F&B sales edged up 0.9 per cent from January.


