Singapore’s retail sales MoM rose 2.30% in December 2025, according to the latest release from the Sigmanomics database[1]. This figure notably outperformed the 1.20% market estimate and reversed the prior month’s 1.40% contraction. Over the past year, retail sales have exhibited volatility, with peaks such as 4.10% in September and troughs like -2.80% in May. The December rebound reflects improving consumer sentiment amid a complex macroeconomic backdrop.

Drivers this month

• Stronger holiday season spending boosted discretionary retail segments.
• Lower inflation rates improved real purchasing power.
• Government stimulus measures supported household incomes.

Policy pulse

The Monetary Authority of Singapore (MAS) has maintained a cautiously neutral stance, balancing inflation containment with growth support. The retail sales uptick aligns with MAS’s inflation target range of 1–2%, suggesting room for steady policy without immediate tightening.

Market lens

Immediate reaction: The SGD appreciated 0.30% against the USD within the first hour post-release, while 2-year government bond yields edged up 5 basis points, reflecting improved growth expectations.

Retail sales are a key indicator of consumer demand and economic health. Singapore’s 2.30% MoM increase in December contrasts with the average monthly growth of 0.70% over the past 12 months. The volatility in retail sales mirrors fluctuations in core macroeconomic indicators such as GDP growth, inflation, and employment.

Monetary Policy & Financial Conditions

MAS’s policy approach has been to manage the SGD nominal effective exchange rate to contain imported inflation. The recent retail sales strength supports a scenario where MAS may hold policy steady in the near term, given inflation’s moderation to 1.80% YoY in November. Financial conditions remain accommodative, with stable credit growth and manageable borrowing costs.

Fiscal Policy & Government Budget

Singapore’s fiscal stance remains prudent, with targeted support for households and businesses. The government’s budget surplus and ongoing infrastructure investments underpin consumer confidence. However, fiscal tightening risks could emerge if global headwinds intensify, potentially dampening retail demand.

External Shocks & Geopolitical Risks

Geopolitical tensions in the Asia-Pacific region and global supply chain disruptions pose downside risks. These factors could impact consumer sentiment and retail imports, especially for discretionary goods. The retail sales rebound in December suggests some resilience but warrants caution.

Historical comparisons show that December’s increase is the largest positive monthly change since September and contrasts with the negative readings in May (-2.80%) and February (-1.50%). The retail sales trend suggests a partial normalization after mid-year disruptions.

Market lens

Immediate reaction: SGD/USD strengthened by 0.30%, while 2-year bond yields rose 5 basis points, reflecting improved growth outlook. Equity markets showed mild gains in consumer discretionary sectors.

Looking ahead, Singapore’s retail sales trajectory will depend on several factors, including inflation trends, monetary policy adjustments, and external risks. We outline three scenarios for 2026:

Bullish scenario (30% probability)

• Global inflation continues to ease, boosting real incomes.
• MAS maintains accommodative policy, supporting credit and consumption.
• Geopolitical tensions ease, stabilizing supply chains.
• Retail sales grow steadily at 1.50–2.50% MoM.

Base scenario (50% probability)

• Inflation moderates but remains near MAS target.
• Monetary policy remains neutral with minor adjustments.
• External risks persist but are contained.
• Retail sales grow modestly at 0.50–1.50% MoM.

Bearish scenario (20% probability)

• Inflation spikes due to supply shocks.
• MAS tightens policy, raising borrowing costs.
• Geopolitical conflicts disrupt trade.
• Retail sales contract or stagnate, with MoM declines up to -1.50%.

Policy pulse

MAS’s upcoming policy review will be critical. The December data supports a wait-and-see approach, but persistent inflation or external shocks could prompt tightening.

Singapore’s December 2025 retail sales rebound signals a tentative recovery in consumer spending after several volatile months. The data aligns with a cautiously optimistic macroeconomic outlook, supported by stable monetary policy and fiscal prudence. However, external uncertainties and inflation risks require vigilance. Market participants should monitor upcoming inflation prints, MAS policy signals, and geopolitical developments closely.

Key Markets Likely to React to Retail Sales MoM

Retail sales data in Singapore often influences currency, bond, and equity markets sensitive to domestic consumption trends. The following tradable symbols historically track or react to Singapore’s retail sales movements:

• SGDUSD – Singapore dollar vs. US dollar, sensitive to domestic economic data.
• STI – Straits Times Index, reflects Singapore equity market sentiment.
• DBS – Major Singapore bank, impacted by consumer credit trends.
• BTCUSD – Bitcoin, often reacts to risk sentiment shifts linked to economic data.
• USDSGD – Inverse of SGDUSD, also sensitive to retail sales data.

FAQ

What does Singapore’s Retail Sales MoM indicate?

It measures the monthly change in consumer spending, reflecting economic health and consumer confidence.

How does retail sales data affect Singapore’s monetary policy?

Stronger retail sales may prompt MAS to tighten policy to control inflation, while weak sales could encourage easing.

Why is retail sales volatility important for investors?

Volatility signals shifts in consumer behavior, affecting equities, currency, and bond markets linked to Singapore’s economy.

Takeaway: Singapore’s December retail sales rebound underscores resilient consumer demand amid a complex global environment, supporting a cautiously optimistic outlook for 2026.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.

Updated 12/5/25