Growth in retail trade as consumer spend increases

Growth in retail trade sales accelerated to a four-month high of 3.5% in June compared with a year earlier from a slightly revised 2.3% (2.4%) in May, Statistics South Africa (StatsSA) data showed.

Sales were expected to increase by 3.4% year-on-year.

Higher activity among general dealers and clothing retailers supported the growth in sales. Figures showed that general dealers contributed 1.7 percentage points, while retailers in textiles, clothing, footwear and leather goods contributed 1.1 percentage points.

Barclays economists Peter Worthington and Miyelani Maluleke said in a research note that data such as weak credit growth and low consumer confidence pointed to a "more challenging" second quarter for consumers after the "fuel-spending boost" of the first quarter.

Seasonally adjusted retail trade sales increased by 0.1% month-on-month in June following a rise of 0.1% in May.

Seasonally adjusted retail trade sales increased by 0.4% in the second quarter of this year compared with the previous quarter, but were up 3.1% when compared with the second quarter of last year.

The main contributors to the increase were also general dealers and retailers in textiles, clothing, footwear and leather goods.