SA Retail Outlook 2018 – Turning the Corner

We think that decent wage increases and job growth in 2018, coupled with some interest rate relief following the positive political developments, could boost consumer confidence and contribute to higher retail sales growth. We believe the spending power of the consumer in 2018 may increase by 6.9% y-y nominal, supported by wage increases of 7.5% and job growth of 2.4%. The key catalyst for the recovery, in our view, is improved consumer confidence.