Retail trade sales fell on an annual basis for the 10th month in a row in January, posting a 3.5% decline. This points to persistently weak demand in a fragile economy which seems to be heading for a first-quarter contraction.
The retail trade sales data, released by Statistics South Africa (Stats SA) on Wednesday, are the latest to add to a gloomy picture for the South African economy ahead of next week’s interest rate decision by the central bank.
The 3.5% year-on-year fall in retail sales was the 10th straight month of decline, which began in April of last year, the first full month of ultra-hard lockdown. So the retail sector has effectively been limping along ever since and has yet to recover, which is no surprise in the wake of the 7% gross domestic product (GDP) contraction in 2020.
It also signals, along with other data such as weak manufacturing and mining output numbers for January, and tepid business confidence and consumer confidence surveys, a faltering start to 2021. The 3.5% drop was considerably steeper than the 1.2% dip recorded in December, no doubt in part because of the renewed lockdown restrictions, including the booze sales ban, that were…