Advertise with fastmoving.co.za
 
 

South Africa’s retail sales rose more than expected in May.
South Africa’s retail sales rose more than expected in May.

Retail sales jump in May ahead of expected rate cuts

ECONOMIC NEWS

Reuters - Jul 18th, 09:24

South Africa’s retail sales rose more than expected in May as sales of household goods, furniture and appliances expanded quickly, a hint that pressure on consumers was easing ahead of an expected lending rate cut that may further support spending. 

Statistics South Africa said retail sales rose 2.2% year-on-year, better than a Reuters forecast for a 1.6% expansion. On a quarterly basis, sales rose 1.7%.

Sales by general dealers were up 4% followed by a 3.2% expansion in the furniture and appliances category, and a 2.9% increase in pharmaceutical goods, a sign consumers were more willing than before to spend on semi-durable goods.

Consumers’ finances have been under strain due to a prolonged period of weak economic activity, climbing unemployment, higher taxes, and fuel price increases, stoking calls for the Reserve Bank (SARB) to reduce lending rates to stimulate spending.

The bank is set to cut interest rates by 25 basis points at Thursday’s meeting, a Reuters poll showed last week, while forward rate markets on Wednesday showed investors pricing in a close to 40% probability of a cut by that margin.

The bank’s policymakers as well as some analysts, however, doubt whether rate cuts will have an impact on long-term growth even if they do boost consumer spending.

“A rate cut will assist at the margins but it will not drive an economic recovery. The nature of South Africa’s economic problems are fiscal in nature, not monetary,” said George Glynos, managing director at ETM Analytics.

The rand inched firmer following the data, trading at 13.9450 per dollar at 1130 GMT from an open of 13.9600. IOL 

Read more about: sales | retail | economy | consumer spend

Related News

CBD oil product launching countrywide in Clicks and Dis-Chem
15/10/2019 - 14:43
South Africa’s top health and beauty retailers, Clicks and Dis-Chem, are both rolling out the Elixinol range of CBD full-spectrum extract products in October.

Checkers launches long-awaited rewards programme
15/10/2019 - 12:20
The wait is over - Checkers Xtra Savings is here! Africa’s largest supermarket group has introduced its latest initiative that shows their loyalty to customers, and not the other way around.

Hyde Park Corner celebrates 50 fabulous years with customers
14/10/2019 - 15:20
Hyde Park Corner is celebrating its golden anniversary with '50 & Fabulous’ celebrations that include exciting events, lucky draws, prizes, special offers, opportunities to give back, milestone exhibits and a whole lot more in October and November.

Retail apocalypse narrative might be over-exaggerated
14/10/2019 - 13:55
There are two sectors on the JSE that have fallen out of favour - Property and Retail.

Christmas is coming: 3 ways retailers can ensure a more profitable festive season
14/10/2019 - 10:29
According to Stats SA, retail figures for December 2018, showed an annual decline of 1.4% instead of the expected 2.1% growth. It seems like brick-and-mortar stores are battling against depleting footfalls and decaying consumer confidence.