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    Retail sales in South Africa fell from 3.1% to 2.9% compared to last year.

    by VT Markets
    /
    Dec 10, 2025
    In October, South Africa’s retail sales decreased from 3.1% to 2.9% compared to the previous year. This drop indicates that consumer spending is slowing down, which could impact economic growth and government policies in the future. Experts will closely monitor this trend to understand its effects on South Africa’s economy. These findings may influence upcoming economic plans and decisions. The decline in retail sales to 2.9% confirms the pattern of decreasing consumer spending we’ve been observing. This corresponds with the disappointing GDP report from last week, which showed growth slowing to just 0.2%. It seems that ongoing high interest rates throughout 2024 and early 2025 are starting to strain household finances. As consumer spending weakens, the chance of another interest rate hike by the South African Reserve Bank in early 2026 is decreasing. We may see the South African rand (ZAR) weaken, especially as the US Federal Reserve indicates it will keep its rates steady into the new year. Traders might consider buying USD/ZAR call options to prepare for a possible rise above the 19.50 level we saw earlier this year. This slowdown directly affects the outlook for the retail sector on the JSE, raising concerns following lackluster Black Friday sales in November. Major retail stocks, which have struggled since the market decline in September, might continue to underperform. Buying put options on the JSE Top 40 index or on specific retail-focused ETFs could be a way to protect against a downturn in the first quarter of 2026. Now, all attention is on the November inflation data expected next week, which is projected to show a further decrease to around 4.8%. If inflation falls, it will strengthen the belief that the SARB’s cycle of rate hikes is over. This makes positioning for lower rates through interest rate futures a smart strategy for the upcoming weeks.

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