Press Office

Singapore, 25 August 2006 - Despite a weaker consumer confidence sentiment, retail sales across Asia/Pacific are still expected to grow in the second half of 2006, according to the latest MasterIndex^TM of Retail forecast released by MasterCard Worldwide today.

All 12 Asia/Pacific markets included in the forecast are predicted to see positive expansion in the second half of the year, with Indonesia taking the lead with a 17.5% year-on-year growth, followed by the Philippines (12%) and China (11.8%).

Other markets predicted to see healthy growth in retail sales are Singapore (8.6%), Malaysia (7.0%) and Hong Kong (5.6%), while the remaining less bullish markets include Australia and New Zealand (4.6% each), Korea (3.8%), Thailand (3.5%), Taiwan (1.6%) and Japan (1.2%).

"Consumer spending will become even more important in the coming quarters to hold up aggregate demand in many markets in Asia, and its strength and sustainability will significantly affect overall economic growth," observed Dr. Yuwa Hedrick-Wong, economic advisor to MasterCard Worldwide in Asia/Pacific.  

The MasterIndex of Retail's forecast for the second half of 2006 is shown in the table below.

(*forecast excludes hospitality, catering and auto sales)

(** forecast excludes hospitality and catering, includes auto sales)

Conducted twice a year in June and December, the MasterIndex of Retail was launched in June 2003 by MasterCard as part of its knowledge leadership initiatives in Asia/Pacific. Combining 10 years of retail sales data[1][1], factoring in the secular trend of growth of the retail industry, and using the MasterIndex^TM of Consumer Confidence as an independent variable[2][2], it provides six-month forecasts of retail sales growth in 12 markets: Australia, China, Hong Kong, Indonesia, Japan, Korea, Malaysia, New Zealand, Philippines, Singapore, Taiwan and Thailand.

It is among the MasterCard MasterIndex suite of research products; the others include:

• The flagship MasterIndex^TM of Consumer Confidence - the region’s most comprehensive and longest running consumer sentiment survey
• The MasterIndex^TM of Travel, which combines outbound travel forecasts for the region with a survey of Asian travelers’ lifestyle trends
• The MasterIndex^TM of Women's Advancement, which compares the socio-economic level of women to men.

NOTE TO EDITORS: The full report, as well as the MasterIndex of Consumer Confidence, can be found at the website www.mastercard-masterindex.com. A summary of the individual market forecasts is found at the end of this release