Advertise with fastmoving.co.za
 
 

For the first time in five years, consumer spending in January grew at the same pace as during the festive season, signifying economic recovery.
For the first time in five years, consumer spending in January grew at the same pace as during the festive season, signifying economic recovery.

Consumers continue their festive-season spend trend in January

ECONOMIC NEWS

By Sunita Menon - Mar 16th 2018, 13:55

For the first time in five years, consumer spending in January grew at the same pace as during the festive season, signifying economic recovery. 

This is according to the Mastercard SpendingPulse report, released on Thursday. The report, which provides a macroeconomic analysis of retail spending trends in SA, showed that consumers started 2018 on a stronger footing amid a downward trend in the inflation rate.

Consumer spending in January climbed 3.8% year on year, after accounting for the effects of inflation.This is the same pace of growth the retail industry saw during the December peak season, which was also the strongest monthly performance since May 2013.

When the effects of inflation are included, retail sales for January 2018 grew 7.3% year on year.

"January retail sales show an improvement in consumer discretionary spending, with South Africans benefiting from a moderation in inflation, a stronger rand and some recovery in industries such as agriculture, as production recovers from the severe drought," commented Sarah Quinlan, senior vice-president and group head of market insights for Mastercard.

"With 2017’s GDP growth exceeding expectations at 1.3% and improved business confidence, we are seeing a healthier economic outlook with a possibility of stronger wage and employment growth in the months to come."<./i>

However, despite the improvements in consumer spending, the general-dealer sector — which includes food and other day-to-day essentials — has continued to underperform for a 13th consecutive month, with inflation-adjusted sales declining 1.2% year on year.

Next week, Statistics SA will release the retail sales figures for January, which is expected to show another strong performance, namely an increase of 6% compared to the same period a year ago.

Retail trade sales increased 5.6% in the fourth quarter of 2017. December’s figure of 5.3% brought the annual retail sales growth for 2017 to 3%, an improvement from 2016’s 1.7% but not a full recovery to 2015’s 3.3%.

© BusinessLIVE MMXVIII 

Read more about: trade | sales | sa economy | retailer | retail

Related News

Checkers brings world-class retail to Constantia with new flagship store
27/11/2019 - 13:01
Checkers has opened the doors to its state-of-the-art 2 330 m² flagship supermarket at the Constantia Emporium as the retailer continues to take innovation to new heights.

Woolworths carves out market share in SA
27/11/2019 - 10:11
In Australia, David Jones's sales declined 2.1%, with the company saying a store refurbishment contributed to the decline.

Push and pull strategies work together to keep consumers coming back for more
26/11/2019 - 10:20
The retail sector is under increasing pressure as consumers have shrinking disposable income in a strained economy. Maintaining share of wallet is critical. Relying solely on a push route to market strategy from manufacturers into retailers is not enough to get consumers buying products. A pull strategy needs to coexist with the push to drive brand consumption. Integrating these strategies requires intelligent and insightful decision-making. This, in turn, requires data generated through smart technology which provides line of sight across the value chain from manufacturer to distribution, retailer to the consumer.

SA expected to sow fewer maize hectares than in previous seasons
26/11/2019 - 10:06
South African farmers are expected to sow 2.8% fewer hectares of the food staple maize next season than forecast in October after the planting season was delayed by rains, a Reuters survey of analysts showed.

Exclusive leases must fall: Commission cracks whip on Shoprite, Pick n pay, Spar, Woolies
26/11/2019 - 09:57
The Competition Commission Inquiry into Grocery Retail, published on Monday, called for an end to the exclusive leases negotiated by national retail chains in all shopping malls across the country in a bid to open up access to markets for smaller players.