The slowdown reflects ''a weakening of consumer confidence, especially with oil prices currently higher and the last jobs report showing unemployment is still high,'' Song Seng Wun, an economist at G.K. Goh Holdings in Singapore, said Friday. ''People were probably also saving up ahead of the great Singapore sale'' in June and July. Singaporeans may be trimming spending after the city's jobless rate rose in the three months to March 31 to its highest in three quarters.

The government expects the $107 billion economy to expand by as little as 2.5 percent this year compared with 8.4 percent in 2004. ''Retail sales reflect consumer confidence'' and may be affected by the latest jobless figures, Lau Chuen Wei, executive director of the Singapore Retailers Association, said before the data was released. ''We're certainly optimistic for the rest of the year,'' she said. The association is aiming for sales of S$5 billion, or about $3 billion, during June and July, when retailers hold an annual sale.

The city's second-quarter economic growth was driven by a rebound in drug production and an influx of tourists, according to David Cohen, director of Asian economic forecasting at Action Economics in Singapore. ''Tourist traffic was very strong,'' he said.

Adjusted for seasonal factors, retail sales in May fell 3.4 percent from the previous month, the Department of Statistics said. Excluding cars, sales fell 2.8 percent. Vehicle sales in May rose 6.9 percent from a year earlier based on current prices, compared with a gain of nearly 16 percent in April. Sales of furniture and household equipment rose 9.1 percent from a year earlier in May. Department store sales gained 8.7 percent, and food and beverage sales gained 6.9 percent. Korean store sales increase Department store sales in South Korea rose for a fifth consecutive month in June, adding to evidence that consumer spending is rebounding from a two-year slump.

Deputy Finance Minister Bahk Byong Won said interest rates should be kept low to spur the recovery. Combined sales at Lotte Department Store, Hyundai Department Store and Shinsegae, South Korea's three biggest department store chains, rose 1.6 percent from a year earlier, the Commerce Ministry said. Sales at the three biggest discount store chains rose 4.9 percent.


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