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Johannesburg - Growth in South Africa’s retail sales accelerated to 9.8% year-on-year (y/y) in April from an upwardly revised 5.3% rise in March, Statistics South Africa said on Wednesday.
Stats SA said retail sales grew by 6.9% in the three months to April compared with the same period a year ago, also at constant prices. A Reuters poll showed economists expected retail sales growth to be steady at 5.1%.
Analysts were pleased by the better-than-expected data.
Senior Nedbank analyst Nicky Weimer said it was a strong number. "I think perhaps we had a bit of a turnaround in April. We had a two-week break which was a mini-festive and retailers are not closed," she said.
“May will be quite a slow month because all the splurge will be over as people consolidate their finances. If you look at this data narrowly it could shock the Reserve Bank, but if they see it in context of long holidays it will not change anything. It would be brave in this kind of environment (global economic uncertainties) to go and hike rates.”
Salomi Odendaal, economist at Citadel, said the figure was better than expected, given negative global sentiment. "We think retail sales will keep on improving in the next few months because interest rates are still very low and inflation as well, and incomes are rising. There’s a possibility interest rates may be hiked more than once this year if we keep on seeing this kind of growth and there aren’t any nasty surprises,” she said.
The y/y retail sales number has crept up in recent months as consumer demand improves and credit demand, though weak, showed housholds finances are slowly improving.
The high level of job losses since the recession is expected to constrain robust growth in retail sales.
The Reserve Bank bank said in its annual report on Tuesday that it expects the recovery to be self-sustaining. At its May policy meeting, the bank said positive momentum observed in the past few quarters in household consumption growth appeared to have been sustained.
Retail sales have previously been a key driver for economic growth but fell sharply during the recession in 2009.
Stats SA said retail sales grew by 6.9% in the three months to April compared with the same period a year ago, also at constant prices. A Reuters poll showed economists expected retail sales growth to be steady at 5.1%.
Analysts were pleased by the better-than-expected data.
Senior Nedbank analyst Nicky Weimer said it was a strong number. "I think perhaps we had a bit of a turnaround in April. We had a two-week break which was a mini-festive and retailers are not closed," she said.
“May will be quite a slow month because all the splurge will be over as people consolidate their finances. If you look at this data narrowly it could shock the Reserve Bank, but if they see it in context of long holidays it will not change anything. It would be brave in this kind of environment (global economic uncertainties) to go and hike rates.”
Salomi Odendaal, economist at Citadel, said the figure was better than expected, given negative global sentiment. "We think retail sales will keep on improving in the next few months because interest rates are still very low and inflation as well, and incomes are rising. There’s a possibility interest rates may be hiked more than once this year if we keep on seeing this kind of growth and there aren’t any nasty surprises,” she said.
The y/y retail sales number has crept up in recent months as consumer demand improves and credit demand, though weak, showed housholds finances are slowly improving.
The high level of job losses since the recession is expected to constrain robust growth in retail sales.
The Reserve Bank bank said in its annual report on Tuesday that it expects the recovery to be self-sustaining. At its May policy meeting, the bank said positive momentum observed in the past few quarters in household consumption growth appeared to have been sustained.
Retail sales have previously been a key driver for economic growth but fell sharply during the recession in 2009.
