SOUTH Africa’s retail sales growth accelerated to 2,5% year-on-year in February at constant prices, from an upwardly revised 0,7% growth in January, Statistics South Africa said on Wednesday.
In the three months to the end of February, retail sales increased by 0,7% over the same period the previous year, also at constant prices.
“I think it (year-on-year figure) is quite a bit stronger but I don’t think it’s out of line with expectations,” said ETM economist Russell Lamberti, adding that the data pointed to resilience in the economy despite electricity cuts as state utility Eskom struggles to meet rising demand.
“Overall it shows an element of resilience that possibly people have been underestimating. If anything, it makes it easier for the central bank to raise rates if they feel the need to do so,” he added.
The rand was slightly weaker at 7,9774 against the dollar at 0922 GMT from 7,9675 before release of the data. The yield on the R157 government bond due in 2015 (ZAR157) edged up to 9,305% from 9,29% beforehand.
In the last few years, South Africa’s economy has mainly been driven by consumer demand, although some analysts say it has slowed down in response to higher interest rates.
The Reserve Bank has lifted its repo rate by 450 basis points to 11,5% since June 2006 as it battles to rein in runaway inflation.– Reuters.