South African Retail Sales Growth Unexpectedly ClimbsRene Vollgraaff
South African retail sales growth unexpectedly quickened for a second month to 3 percent in August, boosted by higher sales for textiles and clothing.
Sales growth accelerated after expanding a revised 2.9 percent in July, Pretoria-based Statistics South Africa said on its website today. The median estimate in a Bloomberg survey of 12 economists was for growth of 1.1 percent. Sales grew 1.1 percent in the month.
The Reserve Bank cut its economic growth forecast for this year to 2 percent as inflation pressures curb consumer spending and demand for credit. Inflation exceeded the central bank’s 3 percent to 6 percent target range for a second consecutive month in August.
“Despite the rise in August, growth in retail sales is likely to remain relatively subdued in the months ahead as consumer confidence is still weak, disposable income growth restricted and access to credit tight,” Johannesburg-based Nedbank Group Ltd. said in an e-mailed note to clients.
Consumer confidence in Africa’s largest economy fell to a 10-year low in the third quarter as strikes hit the manufacturing and mining industries and gasoline costs soared to a record. Policy makers have kept the benchmark lending rate at 5 percent, the lowest level in more than 30 years, since July 2012.
The outlook for household consumption expenditure remains uncertain as high wage settlements are counterbalanced by low employment, high debt levels and rising prices, Reserve Bank Deputy Governor Francois Groepe said on Oct. 11.
The rand gained 0.1 percent to 9.9646 per dollar by 2:45 p.m. in Johannesburg.