Annual retail sales decreased 1.3% year-on-year in December 2020, Statistics South Africa announced on Wednesday.
Although this is a smaller decrease than November’s 4% decrease, this is the ninth consecutive month that retail sales have decreased. Seasonally adjusted retail trade sales decreased by 0.8% in December 2020 compared to November 2020.
This followed month-on-month changes of 2.1% in November 2020 and -0.5% in October 2020.
Ahead of the data release, analysts expected December retail data to fall by at least 3.5% to reflect continued weak consumption momentum.
"This is reflective of the effects of the Covid-19 pandemic on a previous weak economy, with consumer financial health deteriorating amid diminished incomes, job losses and elevated levels of consumer indebtedness," said Kamilla Kaplan, economist at Investec.
The outlook for 2021 is not any better as consumer spending remains subdued because people are traveling less and are working from home, said analysts.
In 2020, retail trade sales decreased by 6.9% compared with 2019. All retailers showed negative year-on-year growth rates over this period.
The main contributors were retailers in textiles, clothing, footwear and leather goods with a 12% decline and with the biggest contributing decline was all "other" retailers at 28.3%. These retailers include those selling jewellery, watches and stationery.
Retail trade sales decreased by 2.6% in the fourth quarter of 2020 compared with the fourth quarter of 2019.