Indonesia: Decline in retail sales softens in August
October 8, 2020
Retail sales decreased 9.2% in year-on-year terms in August, which was a smaller contraction than July's 12.3% decrease. The reading marked the best result since March.
Looking at the details of the release, August's improvement was broad-based, with the food, beverages, and tobacco subsector returning to growth, and the motor vehicles, parts and accessories subsector contracting at a softer pace.
Meanwhile, the trend pointed down, with the annual average variation of retail sales coming in at minus 6.7% in August, down from July's minus 5.8%.
The Central Bank expects retail sales to have contracted a milder 7.3% in September. However, readings for Q3 as a whole still suggest depressed consumer spending in the period, as elevated new Covid-19 cases held back the recovery.
Author: Oliver Reynolds, Economist