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Johannesburg – Wholesale trade sales at constant prices for October improved slightly to –11,5% year-on-year (y/y) after declining a revised –12,4% (–12,6%) in September, Statistics SA data revealed yesterday.

Wholesale trade sales grew at 5,9% last year and 6,3% in 2007, but have been negative for each month of the year so far this year and in double digits since April.

Yesterday’s slight improvement thus brings scant relief, indicative of continuing consumer pressure.

Efficient.co.za economist Freddie Mitchell says it is very difficult to say when wholesale trade sales will start showing signs of recovery while consumer confidence is low within the market.

“The continued contraction in wholesales, albeit lower, just underlines the pressure and weakness wholesale is still experiencing within the economy even though South Africa moved out of the recession during the third quarter.”

Yesterday’s data showed that wholesale trade in real terms (constant terms) for the three months ended October 31 declined by 12,2% compared with the corresponding period last year. Comparing the three months’ seasonally adjusted figures ended October 31 this year with the previous three months, a 0,9% decline is seen.

This comes as retail trade sales at constant prices for October were recorded at –6,5% year-on-year (y/y) from a revised –4,9% (– 5,1%) in September, according to figures released yesterday by Statistics SA.

This was worse than expected and ushered in a call from some quarters for another rate cut by the central bank to provide impetus to the economy.

This wholesale number is not a good sign of a strong upward trend to come either, analysts said. There may be some emerging signs that the country’s economy has hit the bottom, but this is not one of them. – I-Net Bridge