Retail trade sales came in at 2.3% year-on-year in December 2012 from 3.6% in November, Statistics South Africa (Stats SA) said on Wednesday.
The market expectation was that it would slow down to 1.2% year-on-year in December.
The main contributors to the higher-than-expected 2.3% were general dealers, retailers in textiles, clothing, footwear and leather goods and all ‘other’ retailers.
Seasonally adjusted retail trade sales increased by 1% in December 2012.
For 2012, retail sales rose by 4.3%, slightly down from 4.6 % in 2011.
Nedbank economists said consumer spending was likely to moderate during the course of 2013 as weak consumer confidence, heightened worries about job security and high debt made consumers more cautious about spending on non-essential items.
“High inflation will also erode disposable income, offsetting some of the benefits of higher wage settlements. Today’s figures indicate that consumer spending, which is a key component of the economic, is losing some momentum.
“The overall economic outlook remains weak and fragile, while upside risks to inflation have increased due to a weaker rand,” said the bank.
The bank believes that the Monetary Policy Committee (MPC) of the Reserve Bank will keep monetary policy neutral over an extended period, with interest rates remaining unchanged for most of 2013.
“A reversal in policy easing is likely only late in the year or even in 2014,” said the bank. – SAnews.gov.za