GROWTH in South Africa’s retail sales slowed more than expected in September, reflecting both the impact of strike action and pressure on households’ disposable incomes, Statistics South Africa figures released on Wednesday showed.

Despite the moderation in growth, the sector still looks set to contribute positively to economic growth in the third quarter.

Retail trade sales increased by 4.3% year on year in September after an upwardly revised 6.7% (6.4%) increase in August, but fell by 0.5% in September compared with August.

Standard Bank economist Thabi Leoka said the moderation was not surprising.

"We expected this because the transport strike in September affected the consistency of supply of goods to retailers. On top of that, the number also reflects slowing consumer confidence," Ms Leoka said.

KADD Capital economist Elize Kruger also expected the slower pace of growth in retail sales.

"The moderation is not really surprising given that the disposable incomes of households are under more and more pressure from increases in administered prices, and food and fuel," Ms Kruger said.

Stats SA reported that the growth in retail sales was driven mainly by general dealers and retailers in textiles‚ clothing‚ footwear and leather goods.

"We could see the gradual moderation continuing in the next few months," Ms Kruger noted.

Retail sales rose by 4.6% in the three months to September compared with the same period a year ago.

© BDlive 2012