General dealers help boost retail sales
Annual growth rate at 3.8%
RETAIL sales grew 3.8percent last November, when measured in constant 2012 prices.
In a statement issued yesterday, Statistics SA said the highest annual growth rates were recorded for retailers in hardware, paint and glass, pharmaceuticals and medical goods, cosmetics and toiletries and general dealers.
It said the main contributors to the 3.8percent increase were general dealers.
Seasonally adjusted retail trade sales increased by 3.5 percent month on month last November. This followed monthon-month changes of negative 0.6 percent last October and 0.8 percent last September.
Stats SA added that in the three months to November, seasonally adjusted retail trade sales increased by 1.7 percent compared with the previous three months.
Paul Sirani, the chief market analyst at Xtrade, noted these figures could show signs of an economic turnaround.
“2016 was a worrying year for retailers in South Africa, with new credit regulations restricting the industry and consumers across the country strapped for cash.
“Yet, today’s numbers showing an uptick in spending for November could be the green shoots of recovery heading into 2017. Finance Minister Pravin Gordhan, who has had a roller-coaster year, will be hoping that figures like this will help accelerate growth at the World Bank’s new 1.1percent-a-year forecast.”
He added: “December’s festive trading figures are now eagerly anticipated, with any notable jump expected to invite in investors.”
December is traditionally a bumper month for retailers due to festive and back-toschool spending.
However, Jason Muscat, FNB’s senior economic analyst, said the uptick was likely to be short lived.
He said the gain, off the back of a contradiction in October, might indicate that consumers delayed purchases in the first month of the quarter in order to take advantage of Black Friday deals in November. He said this was given credence by the 3.5 percent monthon-month jump from October.
General dealers expanded sales by 4.7percent, hardware by 5.4percent and pharma retailers by 4.9 percent.
Food and beverage sales growth, at 2.7percent, moderated somewhat from October, while clothing sales continued to disappoint in light of stricter lending criteria and negative real credit extension growth, Muscat said.
He added that the misery continued for furniture retailers, with the sector contracting 0.8percent year on year.
“We expect that the revival in the month will be short lived, and that year-on-year December sales will disappoint given high levels of pre-December buying and this morning’s 6.8 percent year-on-year inflation print for the month.”
FNB added there was unlikely to be any interest rate relief for consumers given the sticky inflation numbers. “The February budget speech will provide a clearer picture of what to expect in terms of fiscal tightening and likely tax increases.” – Business Report Online, go to www.busrep.co.za