Retail sales grew by 5.1% year on year in April 2025, according to data released by Stats SA on Wednesday.
This marks a sharp rebound from the revised 1.2% growth recorded in March and signals renewed household spending after a muted start to the first quarter.
The largest contributors to April’s growth were general dealers, which saw a 5.3% year-on-year increase, adding 2.3 percentage points to the overall rise, and retailers in textiles, clothing, footwear and leather goods, which surged 12.5%, contributing 2.1 percentage points.
On a seasonally adjusted monthly basis, retail trade sales rose 0.9% in April, reversing two consecutive months of contraction [minus 0.3% in March and minus 1.1% in February] and suggesting the sector entered the second quarter with renewed vigour.
Retail trade sales for the three months ended April 2025 were 3.4% higher than the same period a year ago, with textiles and clothing retailers (up 10.5%, contributing 1.6 percentage points) and general dealers (up 2.8%, contributing 1.3 percentage points) again emerging as the key drivers.
“Prior to the start of the two-pot withdrawal scheme in later 2024, economic conditions within the household sector were relatively tough, resulting in subdued consumer spending,” said Stanlib chief economist Kevin Lings.
“However, the two-pot cash withdrawal in the final quarter of 2024 and into the early part of the first quarter [of] 2025, coupled with four cuts in SA interest rates since September 2024 and subdued inflation has provided some uplift to SA retail activity, which is expected to be mostly sustained during the remainder of 2025.”
He pointed out several cautionary factors. First, the National Treasury chose not to adjust personal income tax brackets for inflation, which is likely to put pressure on household disposable income.
Second, inflation in SA is projected to rise in the second half of the year, which could further erode real income gains. Third, banks are expected to remain conservative in issuing credit to households, which may limit access to finance.
The seasonally adjusted quarter-on-quarter performance painted a less upbeat picture: sales declined by 0.5% over the February-April period compared to the previous three months.
The contraction was primarily driven by a 1.2% fall in general dealer sales and a 3.3% drop in food, beverages and tobacco retailers in specialised stores, subtracting 0.5 and 0.3 percentage points respectively.
Investec economist Lara Hodes noted retailer business confidence fell into contractionary territory in the second quarter “and while we do expect consumer confidence to have picked up from the dire level recorded in the first quarter [of] 2025, on an improvement in political certainty, it will likely remain subdued” during the remainder of 2025, based on socioeconomic concerns.
“Globally, uncertainty surrounding tariffs and trade remains, weighing on growth expectations, while geopolitical tensions have escalated,” she said.
Despite the quarterly decline, some segments showed resilience. Notably, the “other retailers” category grew by 2.0% quarter on quarter, contributing 0.2 percentage points, likely reflecting demand in niche or non-traditional outlets.
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