Pretoria - Retail trade sales increased by 7.1% in August above market expectation, Statistics South Africa (Stats SA) said.
"Retail trade sales in real terms increased by 7.1% year-on-year in August 2011. The highest annual growth rate was recorded for 'all other retailers' (15.1%), followed by retailers in household furniture, appliances and equipment (14.3%)," said Stats SA.
Market expectation was that retail trade sales would accelerate to 4.9% from a revised 3% in July.
Nedbank economists said retail sales were likely to moderate from August's strong growth rate but should remain relatively firm up to the December shopping season.
"However, slower growth in consumer incomes and depressed consumer confidence are likely to dampen sales growth. Growth in consumer disposable incomes slowed to 4.1 % on an inflation-adjusted basis in the second quarter of this year after increasing by more than 5 % per quarter in each of the prior three quarters, with higher inflation mainly behind the slower increase. Domestic demand growth remains generally moderate despite today's strong number and there are no visible demand pressures in the economy," said Nedbank.
In real terms, retail trade sales for the three months ended August 2011 reflected an increase of 4.1% compared with the three months ended August 2010. The largest contributor to the 4.1% increase was 'retailers in textiles, clothing, footwear and leather goods' (6% and contributing 1.2 percentage points), followed by 'general dealers', said Stats SA.
"Domestic demand growth remains generally moderate despite today's strong number and there are no visible demand pressures in the economy. The current upward trajectory of inflation is mainly due to cost-push factors. This, against the backdrop of a fragile global environment, is likely to prompt the Reserve Bank to maintain its cautious wait-and-see approach in the coming months," said Nedbank
