Retail sales central to rates puzzle
January 16, 2008
By Evan Pickworth
Johannesburg - South Africa's November retail sales data was keenly watched on Wednesday by the market for direction ahead of the key rates decision on January 31 and CPIX on January 30.
"Rarely has such a number been so closely watched or had such a wide range of economist estimates placed on it," noted global analysts Lehman Brothers.
Retail sales growth slowed to 0.2 percent year-on-year in November, the lowest in four years, as higher interest rates put a dampener on consumer spending, official data show.
Statistics South Africa said sales growth slowed from an upwardly revised 1.9 percent in October, while in the three months to end-November, sales increased by 1.2 percent.
Higher interest rates and stricter laws for accessing credit pinched consumer pockets and support the case for the central bank to leave rates on hold.
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