Retail sales up, overall trend 'still slowing'
19 July 2012
South Africa's retail trade sales grew by 6.4 percent year-on-year in May, Statistics SA said on Wednesday.
This was an improvement from the change of 1.1 percent in April.
The highest annual growth rate was recorded for hardware, paint and glass at a rate of 11.1 percent, the agency reported.
This was followed by textiles, clothing, footwear and leather goods at 11 percent and other retail sales at 9.8 percent.
FNB property strategist John Loos said that despite the improvement in May, the broad slowing growth trend in retail was "still believed to be in progress".
"Real retail sales growth rose significantly during May, on a year-on-year basis, from 1.1 percent in April to 6.4 percent," he said.
"This, however, is not believed to reflect any improvement in economic conditions, but rather a base effect, as a sharp 10 percent growth surge in April last year works its way out of the year-on-year growth number, and the May 2012 growth then comes off a relatively low base compared to April."
Loos said monthly retail figures were often volatile and that it was better to examine trends using a three-month moving average.
On a three-month moving average basis, the recently slowing year-on-year growth trend in real retail sales continued.
"I am of the opinion that we should anticipate further broad slowdown in year-on-year retail growth in the coming months, based on weakening consumer confidence that goes hand in hand with a slowing economic growth rate," he said.