We update our Consumer Wallet model, which measures the growth in consumer spending power, and serves as a proxy for the likely level of retail growth this year. The recovery in wage income is slower than we initially expected, although this is partly offset by the extension of Covid-19 social grants. We think a surge in long-term insurance claims and benefits could provide the most relief for consumers in 2021. Consumers may use this windfall to spend on big-ticket items, which could explain the surprisingly strong growth in home improvement spend. On the expense side, the sharp increase in the oil price would negatively impact consumers’ transport costs
