Retail trade figures down 5.3%

According to Stats SA, the retail sales for the first quarter of 2009 reflected a decrease of 2.9% compared with first quarter of 2008.

Investment Solutions senior economist Chris Hart told BuaNews that the drop was not surprising. “This [the figures] is not surprising. Consumers have not been able to access credit since the economy is in a little bit of trouble,” Hart said on Wednesday.

He further predicted that the drop is likely to lead to another rate cut when the Reserve Bank's Monetary Policy Commitee meets this month. “This will see a likely cut in the interest rate later this month,” said Hart.

The drop comes despite another 100 basis point cut in the repo rate announced by Reserve Bank Governor Tito Mboweni last month.

According to Stats SA, retailers in household furniture, appliances and equipment contributed negatively to the change in retail trade sales.

Article published courtesy of BuaNews