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Independence Day helps retailers capitalize on rising consumer confidence in August
Retail sales show a significant upward trend in August on a rise in consumer confidence attributed to Independence Day celebrations, according to preliminary BI data, notwithstanding weakening manufacturing sector activity.
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A worker arranges sugar-sweetened beverages on Dec. 14, 2023 in a supermarket in Jakarta. (Antara/Cahya Sari)
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reliminary data from Bank Indonesia (BI) point to a significant annual increase in retail sales parallel to rising consumer confidence in August, notwithstanding weakening activity in the manufacturing sector.
The retail sales index (RSI), which is based on a monthly survey conducted by the central bank, is projected to grow 5.8 percent year-on-year (yoy) to 215.9 in August from 204.1 in the same month last year.
On a monthly basis, the August RSI forecast marks a 1.6 percent increase from 212.4 points recorded in July.
The projected rise in August was due primarily to “demand increases ahead of the celebrations [to commemorate] Independence Day of the Republic of Indonesia, supported by discount pricing strategies implemented by retailers,” BI spokesman Erwin Haryono said in a statement released together with the survey results on Tuesday.
In July, the RSI saw a deep monthly contraction of 7.2 percent that was attributed to normalization following increased demand in June around Idul Adha, which generally boosts consumer spending.
August’s projected growth in retail sales was driven by a 5.1 percent yoy rise in the food, beverages and tobacco category and a 6.3 percent yoy increase in spare parts and accessories, according to the preliminary data.
On the other hand, a prolonged slump in sales of information and communications technology devices since the start of the year continued in August to book a steep annual contraction of 11.5 percent.
