Retail sales grow 0.2% year on year in August

Retail sales grew just 0.2% in August compared with a year earlier, Statistics SA said on Wednesday, after the 0.8% increase that was reported last month for July.

That was much slower than economists had expected. The Trading Economics forecast was for year-on-year growth of 1.4%, while the Bloomberg consensus was less optimistic, at 0.6% growth.

The retail sector has experienced a long period of tough trading conditions, with consumers' ability to spend constrained by high levels of household debt and a tighter lending environment.

Rising inflation has also been a factor - especially rising food prices after the worst drought in SA for decades. Data released earlier on Wednesday showed inflation as measured by the consumer price index (CPI) accelerated to 6.1% in September, breaching the Reserve Bank's 3%-6% target.

Compared with a month earlier, retail sales grew 0.3%, Stats SA said on Wednesday, while for the three months to August they were 0.9% higher than the year-earlier three-month period.

With the August data, the July figure was revised slightly higher to 1.2%.

Source: BDpro