Retail sales fall by 1.7 in January

Wednesday, March 17, 2010

Pretoria - Retail trade sales in January fell by 1.7 percent year-on-year, reported Statistics South Africa (Stats SA) on Wednesday.

"Retail trade sales, at constant (2008) prices, for January 2010 reflected a decrease of 1.7 percent," said Stats SA. This is in comparison to a decline of 3.8 percent in December 2009.

Nedbank economist Johannes Khosa said the number was much better than what had been expected.

"Consensus was that it would come in at -2.5 percent year-on-year but it came in at 1.7 percent. This indicates general improved consumer confidence and as a result of low inflation. We expect this trend to continue throughout the year," said Khosa.

He said the improvement was likely to continue also as a result of the upcoming FIFA World Cup in June.

According to Stats SA at constant (2008) prices, the three months ended January 2010 reflected a decrease of 4.1 percent compared with the three months ended January 2009.

It said the main contributors to the 4.1 percent decrease were all other retailers, general dealers and retailers in hardware, paint and glass.

Wednesday's data, according to Khosa will not have an impact on the deliberations of the Reserve Bank's Monetary Committee meeting on rates next week.

"We are seeing improvements in the supply side and on the demand side there is also improvement compelling the MPC to leave rates unchanged," he said.

The repo rate currently stands at 7 percent.

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