South Africa: More and more red lights flashing

October output data suggest that, after a very weak Q3, South Africa’s economy may have contracted outright at the start of Q4. Figures released today show that retail sales fell by 0.2% y/y in October. The median forecast of the analysts polled by Bloomberg was for an increase of 1.2% y/y, with none of the analysts predicting an outright decline. October was, indeed, the worst performance for the sector since December 2009. This is particularly worrying given the crucial role that consumer spending has played in supporting the economy in recent quarters.