TAIPEI (Taiwan News) — Taiwan's retail sales fell for the fourth consecutive month in July, totaling NT$388.4 billion (US$12.71 billion), a 3.6% year-on-year decrease, according to data released by the Ministry of Economic Affairs on Tuesday.

Retail sales were lower than the MOEA’s forecast, which projected the figure to be around NT$394.9 billion, or a 1% annual decline, per CNA.

The MOEA attributed the decline in retail spending to the uncertainty of US tariffs, with consumer spending on durable goods potentially increasing in the second half if tariff rates are finalized.

Auto and two-wheeler sales were the worst hit, dipping to NT$70.6 billion, a 19.7% year-on-year decrease, the largest decline in four years. The drop in sales was due to weak market sentiment and delayed delivery of imported vehicles amid tariff concerns.

The decline in vehicle sales dragged down overall retail sales, according to MOEA's Department of Statistics Deputy Director Chen Yu-fang (陳玉芳). Chen said that excluding automobile and two-wheeler sales, retail sales in July would be 0.8% higher than a year earlier.

Chen said machinery and equipment sales will benefit from AI business opportunities and continue to grow in the second half of the year. However, demand for traditional industries such as building materials and chemical materials remains weak.

MOEA data revealed the restaurant industry saw sales revenue in July reach NT$87.1 billion, a year-on-year increase of 2.8%. Restaurants and beverage stores benefited from joint product launches and promotional activities, boosting overall performance.

Cumulative restaurant sales for the first seven months reached NT$618.5 billion, a 3% year-on-year increase. Chen said that economic uncertainty continues to impact high-end restaurants, though the overall sector is expected to maintain positive growth throughout the year.