In October, there was an unexpected surge in South African retail sales, reaching their highest level in more than two years, with positive expectations for continued economic growth.
General dealers played a significant role in this sales increase, which jumped by 6.3% in October year-on-year, up from 1.1% the prior month, according to a report from Statistics SA released on Wednesday. The median projection from three economists in a Bloomberg survey was at 2%. On a month-on-month basis, sales rose by 1.6%.
ADVERTISEMENT
CONTINUE READING BELOW
Retailers are likely to see ongoing sales growth, buoyed by improved consumer sentiment among wealthier demographics, falling interest rates, stable inflation, and pension reforms permitting earlier access to portions of retirement savings.
Since September, the central bank has lowered interest rates by 50 basis points, bringing the policy benchmark down to 7.75%, while inflation currently sits at 2.9%.
“Despite a slight dip in consumer confidence during the fourth quarter of 2024, there is a significant increase in the willingness of consumers to spend,” noted Jee-A van der Linde, senior economist at Oxford Economics. “We expect that consumers’ spending power will gradually strengthen in 2025.
© 2024 Bloomberg L.P.
Stay informed with Moneyweb’s extensive finance and business news on WhatsApp here.
