Retail continued its rebound in August - the second full month of reopening after the circuit breaker - although the sharp jump in sales seen in July has petered out.
Takings at the till declined 5.7 per cent compared with August last year but better than the year-on-year drop of 8.5 per cent in July, the Statistics Department noted yesterday.
Excluding motor vehicles, retail sales fell 8.4 per cent year on year.
However, on a month-on-month seasonally adjusted basis, the increase in retail sales tapered off, rising only 1.4 per cent from July to August, compared with the 27.2 per cent surge from June to July.
OCBC Bank head of treasury research and strategy Selena Ling said discretionary spending remained soft compared with pre-pandemic levels.
She noted that while more people are dining out, the takings at food and beverage services still dropped year on year, underlining the ongoing challenges facing the sector.
United Overseas Bank economist Barnabas Gan also noted that growth rates have tapered sharply from the levels seen in June and July: "This could suggest that the initial domestic pent-up demand for a broad (part) of Singapore's retail sales segment has gradually dissipated since phase two started on June 19."
Most retail sectors still registered year-on-year declines in August.
Food and alcohol fell the most, down 42.6 per cent, followed by department stores, where takings dropped 35.3 per cent. Sales of cosmetics, toiletries and medical goods, and wearing apparel and footwear, were also took a big hit.
But supermarkets and hypermarkets continued to see sales rising, with growth of 21.9 per cent. Stores selling furniture and household equipment, and computers and telecommunications items also had a boost on the back of higher demand as people work from home.
Motor vehicle sales rose by 12.1 per cent but revenue from food and beverage services fell 28.6 per cent from August last year - higher than the 25.4 per cent decline in July.
This was mainly attributed to food caterers, who saw sales plunge 70.6 per cent as catering services for most foreign worker dormitories were no longer required from August, Singstat said.
Restaurants, cafes, food courts and other eating places and fast-food outlets also saw takings drop.
The total sales value of food and beverage services in August was estimated at $665 million, with online turnover accounting for an estimated 20.6 per cent.
Online retail sales made up an estimated 10.9 per cent of the estimated total turnover of $3.4 billion.
Retail sales are unlikely to cross into positive territory this year, Ms Ling said, predicting a drop of 14 per cent for the 12 months. She added: "This would mark the third year of contraction for the domestic retail sector.
"In the interim, the SingapoRediscovers voucher is unlikely to be a short-term panacea, albeit the opening up of travel bubbles and more green-lane arrangements to allow for more overseas visitors should be welcome relief over the medium term."
Singaporeans will get these tourism vouchers to help businesses battered by the pandemic.
Mr Gan said: "Barring a reintroduction of social distancing measures, the return of domestic consumer demand should also cushion the rate of contraction on a year-on-year perspective for the rest of 2020.
"However, overall retail sales may still be unable to surpass 2019 levels, given the sharp declines already seen in the first half of 2020 amid the lack of tourism-related demand."
