Consumer Watch – February 2018

We report on broadly positive news flow in February. Positive sentiment drove business confidence (as reported by SACCI) by 3.3-points. Retail sales growth for December 2017 came in healthy at 5.3% y/y. CPI and PPI started 2018 off on a decline, CPI and PPI fell 30bps and 10bps. Manufacturing (PMI) gaining 5.0 points in January. The rand closed the month of February even stronger at ZAR11.79/USD. A further reduction in fuel prices is expected, petrol and diesel are expected to fall by 38c/litre and 47c/litre respectively. The recently announced increase in VAT to 15% was a tough call by government, for our view, see Shamil Ismail’s Impact of the 2018 National Budget on the Consumer Wallet (published: 21/02/2018).