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Retail sales beat estimates on Black Friday boost

‘There’s a chance of some easing as inflation continued to surprise on the downside’ – Nedbank.
Image: Shutterstock
South African retail sales beat estimates and grew the most in seven months in November as specials offered by retailers boosted trade.

Sales increased 2.6% from a year earlier compared with a revised 0.4% growth in October, Pretoria-based Statistics South Africa said in a statement on its website on Wednesday. The median estimate of nine economists was for 0.7% growth.

Key insights

  • With consumer confidence still at a two-year low in the fourth quarter, most of the uptick in retail trade were due to the local Black Friday special offers in November. Sales were 3.1% higher than in October, the biggest monthly increase this year.
  • The impact of Black Friday trade has been visible in South African retail for the last three years and is gaining in popularity. Since 2017, November has shown the strongest month-on-month sales increase every year. That surge was followed by a monthly contraction in 2017 and 2018 and after South Africa had the deepest power cuts yet in December, the trend may continue.

Nedbank Group Economic Unit said strong retail sales growth is not expected to be sustained in the coming months as household spending will be contained by subdued consumer income growth and a deterioration in consumer confidence.

“Today’s figures will boost fourth quarter growth figures as household spending accounts for about 60% of GDP. However, spending may have been brought forward to take advantage of special offers, and general economic conditions remain subdued,” said the bank unit.

“The MPC will probably keep interest rates unchanged at 6,5% on Thursday mainly due to concerns over the country’s poor and deteriorating fiscal outlook and its implications for Moody’s sovereign risk rating. However, there is a chance of some easing as inflation continued to surprise on the downside, the rand firmed and economic activity remained poor.”

© 2020 Bloomberg L.P.

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COMMENTS   9

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The reserve bank committee is too rigid and slow. Cut the rate to 5%

I say raise the rates to attract investment.

I say give the bank to the government because errr ehhh well anyone calling for it to be nationalised doesn’t have an educated suggestion.

My honest take? Has any thought maybe we should shrink the range between repo and prime? That way we can increase the one to attract FDI through bond sales but decrease the other to encourage domestic buying and business borrowing.

I would say 80% + were using credit cards! Now when we go to junk status and the interest rates POP they will pay the price. Let’s face it with the over-regulation and sad business practices from the government THE FLUSHING SOUND IS GETTING CONTINUAL!!

Perhaps the buyers opened accounts, lending from Game and Shoprite?
Then ‘those’ that can’t afford wall to wall TV’s can also buy them?

If used responsibly, they still got a good deal.
Save R 40 on a jar of Nescafe Gold.
Save R 35 on 18 toilet rolls.
Retailers only have themselves to blame. They exploit consumers, something is not right.

Black Friday- if the price is right, people buy.people are also happy with specials or buy one get one free.

Black Friday…Its like shooting at your enemy and bleed to death yourself.

What isn’t mentioned is that many people put themselves in debt in order to take advantage of these reduced-price deals.

End of comments.

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