RETAIL SALES SURVEY December 2016 The Retail Sales Survey confirmed stronger annual sales growth on December 2016, with the Real Sales Index (RSI) accelerating from 9.9% (yoy) the month earlier to 10.5% (yoy) on the back of food sales. Regionally, however, retailers in Banjarmasin reported the strongest annual RSI growth at 14.9% (yoy). Respondents predicted slower real sales growth in January 2017 to 9.5% (yoy). The slowdown stemmed from foods, with growth decelerating from 10.5% (yoy) to 8.5% (yoy), contrasting non-food sales, for which growth accelerated from 10.4% (yoy) to 10.9% (yoy) over the same period. Retailers also predicted milder inflationary pressures on goods and services in March 2017, with the corresponding 3-month Price Expectations Index (PEI) observed to decline 0.1 points to 129.5. In contrast, respondents estimated inflationary pressures to return in the next six months (June 2017), reflecting a bump in the 6-month PEI from 126.8 to 131.7. Real Sales in December 2016 Retailers confirmed stronger annual sales growth in December 2016. Retailers confirmed stronger annual sales growth in December 2016, indicated by a Real Sales Index (RSI) of 218.0 as growth accelerated from 9.9% (yoy) the month earlier to 10.5% (yoy) (Graphs 1 and 2). The rise was primarily driven by foods, for which growth was reported to accelerate from 8.4% (yoy) to 10.5% (yoy) over the same period. Graph 1. Real Retail Sales Index Methodology The Retail Sales Survey has been conducted monthly to acquire early information concerning GDP trends from a private consumption perspective. The Retail Sales Survey was first conducted in September 1999 and in January 2015 the survey involved 700 retailers as respondents using purposive sampling in ten cities, namely Jakarta, Semarang, Bandung, Surabaya, Medan, Purwokerto, Makassar, Manado, Banjarmasin and Denpasar. The index is calculated using commodity and city weights, where commodity weights based on the Input-Output (I-O) table, while city weights based on the share of household consumption in Gross Regional Domestic Product (GRDP) to household consumption in Gross Domestic Product GDP. Currently, panel respondents are grouped according to seven KBLI (Indonesian Standard Industrial Classification) established in 2009. The real index presented with 2010=100 as the base year (previously 2000=100). Meanwhile, general price projections calculated by using the balanced score method (net balance + 100) using city weights according to the Cost of Living Survey (SBH). 1
Graph 2. Performance of Real Sales Growth On the other hand, non-food prices maintained growth momentum, albeit decelerating on the previous period from 12.0% (yoy) to 10.4% (yoy) (Graph 3). Other household equipment and other goods were the main contributors to the slowdown, with growth slowing respectively from 10.2% (yoy) and -3.6% (yoy) last period to 0.8% (yoy) -6.4% (yoy). Declining sales of cement products and construction equipment were cited as the main drags on other household equipment, while pharmaceutical and cosmetic products undermined growth of other goods. Graph 3. Real Sales Annual Growth of Food & Non Food Commodity Groups Graph 4. Real Sales Annual Growth of Motor Vehicles Spareparts and Fuels Commodity Groups 2
Graph 5. Real Sales Annual Growth of Information & Comm. and Other Household Equipment Commodity Groups Graph 6. Real Sales Annual Growth of Cultural & Recreation and Other Goods Commodity Groups The latest monthly data pointed to stronger real sales growth in December 2016, accelerating from 1.9% (mtm) in November 2016 to 8.1% (mtm) on the back of all commodity groups, especially information and communications equipment (12.4%, mtm), followed by other goods, particularly clothing (8.3%, mtm). Real Sales Expectations for January 2017 Respondents predicted real sales momentum to slow in January 2017. Respondents predicted robust real sales momentum in January 2017 despite growth moderating from 10.5% (yoy) to 9.5% (yoy), with the Real Sales Index (RSI) recorded at 213.3 (Graphs 1 and 2). The slowdown stemmed from foods, with growth decelerating from 10.5% (yoy) to 8.5% (yoy), contrasting non-foods, for which growth accelerated from 10.4% (yoy) to 10.9% (yoy) in the same period. The monthly data indicated a real sales contraction of -2.1% (mtm) in January 2017, compared to expansion of 8.1% (mtm) the month earlier. The contraction affected all commodity groups, in particular other goods (-5.4%, mtm). Regional Real Retail Sales Retailers in Banjarmasin reported the strongest annual RSI growth in December 2016. Regionally, retailers in six of the surveyed cities reported stronger annual RSI growth in December 2016, especially in Banjarmasin (14.9%, yoy), followed by Bandung (14.8%, yoy). For January 2017, however, retailers in Denpasar predicted the strongest RSI growth (30.7%, yoy), followed by Jakarta (19.8%, yoy) (Graph 7). 3
Graph 7. Performance of Real Sales Growth (YoY) in Jakarta, Bandung, Banjarmasin, and Denpasar Price Expectations for the Upcoming Three and Six Months Retailers predicted milder inflationary pressures on goods and services in March 2017. Retailers predicted milder inflationary pressures on goods and services in the next three months (March 2017), with the corresponding 3-month Price Expectations Index (PEI) observed to decline from 129.6 the month earlier to 129.5 (Graph 8). In contrast, respondents expected inflationary pressures to return in the next six months (June 2017), reflecting a bump in the 6-month PEI from 126.8 to 131.7 (Graph 9). Graph 8. Price Expectations Index for the Upcoming Three Months Grafik 9. Price Expectations Index for the Upcoming Six Months (Indeks) (%) 180.0 5.0 170.0 160.0 150.0 140.0 130.0 120.0 4.0 3.0 2.0 129.6 1.0 129.5 0.0 110.0 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 2014 2015 2016 2017-1.0 3-month cumulative inflation (RS) Price expectations in three months time (LS) 4
Sales Expectations for the Upcoming Three and Six Months Respondents predicted slower sales in March 2017. Respondents predicted slower sales in the next three months (March 2017), evidenced by a drop in the 3-month Sales Expectations Index (SEI) from 136.2 last month to 123.8. Bucking the downward trend, however, retailers predicted sales to rebound in June 2017 as seasonal public demand spikes during the holy fasting month of Ramadhan, with the 6-month SEI increasing 6.0 points from 133.7 to 139.7 (Graph 10). Graph 10. Sales Expectations Index for the Upcoming Three and Six Months 5
Appendix Table 1. Real Retail Sales Index by Categories Table 2. Growth (y-o-y) of Real Retail Sales Index Table 3. Growth (m-t-m) of Real Retail Sales Index 6
Table 4. Real Sales Index by City Table 5. Annual Growth (y-o-y) of Real Sales by City Table 6. Monthly Growth (m-t-m) of Real Sales by City 7
Table 7. Expectations for Prices and Sales DESCRIPTION 2015 2016 July Aug Sep Oct Nov Dec Jan Feb Mar Apr May June Juli Agst Sept Okt Nov Dec* General Price Expectations - Next 3 months 132.1 151.4 150.2 147.3 144.8 131.2 123.7 128.4 139.7 148.0 139.7 128.8 120.7 122.5 134.3 133.6 129.6 129.5 - Next 6 months 137.8 132.3 126.6 127.3 128.8 137.9 135.2 130.1 115.8 111.0 132.2 133.3 131.4 132.4 132.3 124.8 126.8 131.7 Sales Expectations - Next 3 months 121.5 121.2 130.7 123.3 130.4 124.0 127.2 131.2 139.6 142.5 132.3 133.0 129.6 127.5 138.9 133.8 136.2 123.8 - Next 6 months 132.9 119.3 119.0 123.9 128.6 138.1 145.0 136.8 132.8 122.8 129.3 139.1 143.0 136.0 127.1 133.8 133.7 139.7 *) Preliminary figure 8