• Distributive trade grew by 7.8% yoy in January

• Sales value surpassed RM100bn for eighth consecutive month

• Slower growth in wholesale trade and retail trade

• Sales of motor vehicle rebounded in January

• Buoyant domestic spending could support retail sales

Growth in distributive trade moderated to 7.8% yoy in January, as the monthly sales value declined slightly to RM108.9bn from RM109.3bn. Retail sales, which contributed 40.3% to total distributive trade sustained its double digit growth for the 8-consecutive months as it increased by 10.6% yoy to RM43.9bn, slowing from a 12.4% rise in the prior month. However, it was the weakest growth rate since September last year. At the same time, wholesale trade (48.5%) grew at a softer 6.2% to reach RM52.9bn. Meanwhile, sales of motor vehicles (11.2%) recovered from a 1.4% fall in the preceding month and jumped 4.8% to RM12.2bn.

On monthly basis, the distributive trade decreased by 0.3% in January from 2.9% rise in December. The slower growth was mainly due to sharp decline in retail trade (Jan: -1.8%; Dec: +4.2%) and sluggish growth in wholesale trade (Jan: +0.2%; Dec: +3.3%). On the other hand, sales of motor vehicles recovered to 2.6% mom in January after falling by -3.2% in December.

Source: BIMB Securities Research - 15 Mar 2019