The South African Chamber of Commerce and Industry’s (Sacci’s) December Trade Conditions Survey registered a contraction after stabilising in November, CEO Neren Rau said on Thursday.

Despite reporting moderate conditions last month at 52 index points, the seasonally adjusted trade activity index (TAI) lost momentum during December, falling to below the 50 mark at 48 index points.

“This suggests that consumer activity remained under pressure as the bulk of December trade performance is driven at the retail level,” Rau said.

However, the TAI was higher than the 42 and 45 points reached in December 2011 and 2012 respectively.

Seasonal factors led to a decrease in sales volumes and new orders from 58 index points each in November, declining to 45 and 42 respectively in December.

“Inventories declined [from 57 to 46] owing to lower levels of inventory building as many suppliers closed during December. Backlogs on orders [at 40 index points] subsided [from 53] over the holiday period,” Rau noted in the survey.

Selling prices, increasing to 63 index points, and input prices, steady at 71, remained above the 50 index-point mark during December.

The seasonally adjusted trade expectations index (TEI) remained steady at 61 in December, while price expectations indices on sales and inputs jumped 8 and 7 points respectively to 79 and 87.

“The six-month outlook for sales volumes improved (by 9 index points) as post-holiday intermediary trade is set to resume; new orders were up by 6 points to 65 and the supplier deliveries index was stable at around 55,” Rau explained.

Inventory levels bounced back into positive territory registering 60 index points.

Meanwhile, TAI employment conditions fell into negative territory with 47 points, down from the 51 recorded in November.

The TEI for employment remained positive at 55, after recording 56 in November.