Indonesia: Retail sales contract at sharpest rate since November 2008 in April
Retail sales decreased 16.9% year-on-year in April (March: -4.5% yoy). April’s reading marked the worst result since November 2008, and was driven by declines in sales of motor vehicles, parts and accessories, cultural and recreation goods, information and communication equipment and fuel. Accordingly, the trend pointed down, with the annual average variation of retail sales coming in at minus 0.7%, down from March’s plus 1.3% reading.
The Bank expects retail sales to have contracted an ever sharper 22.9% in May due to the impact of Covid-19 and related social distancing measures, which suggests extremely weak private consumption in the second quarter. However, private consumption should gradually recover in the second half as restrictions are gradually lifted: The city of Jakarta already began to ease restrictions from early June.