Johannesburg- Following an unexpected decline of 1.5% in August, the September retail sales volumes rebounded by 2.1% year on year (y/y), against market expectations of a 0.1% y/y decline.
The month-on-month seasonally-adjusted volumes, which is a more meaningful measure under the circumstances and aligns with the official GDP calculation, gained 5.1% in September, after recording an incomplete recovery of 4.9% m/m in August, following a deep riot-induced 11.2% decline in July.
However, the successive recovery was not enough to fully counteract the July blow.
Compared to the previous quarter, the 3Q21 trade sales declined by 5.4%, confirming that the retail trade sector will contribute negatively to the 3Q21 GDP.
This means that support from the moderation in Covid-19 infections, the consequent easier lockdown restrictions, and the resumption of Social Relief of Distress (SRD) grants has not yet been enough to counteract the July effect.
The seasonally adjusted September volumes are still 2.0% lower compared to June, prior to the unrest.
Year-to-date volume sales are 8.0% higher compared to the same period in 2020, but still 1.4% below 2019 levels.
Retail sales outlet performance
The lift in volume sales was spearheaded by growth in Clothing and Footwear, which increased by 11.3% y/y, following a 6.5% y/y increase in August.
“We expect this uptrend to continue, as mobility improves, and workers slowly make their way back to workplaces. Pharmaceuticals also continued the uptrend, recording 10.4% y/y, following a 3.6% y/y increase in August,” FNB said in a statement.
“Pent-up demand associated with the lifting of trade restrictions on liquor dissipated somewhat, with volumes attributed to Food, beverage and tobacco product retailers rising by only 2.4% y/y, following a strong 6.7% growth in August. On the opposite end of the spectrum, “Other” retailers continued to drag volume sales lower, declining by 3.0%, following a 3.4% decline in August. Hardware material also declined, by 1.0% y/y, in line with the waning home-improvement drive,” FNB further stated.
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