Inflation slows in August as food, fuel costs ease
Statistics South Africa said on Wednesday that annual consumer price inflation slowed to 3.3% in August, down from 3.5% in July.
Price Statistics chief director Patrick Kelly said softer food and fuel prices helped ease the inflation rate.
Annual inflation for food and non-alcoholic beverages dropped to 5.2 per cent, while fuel fell 5.7 per cent.
“Annual inflation for food and non-alcoholic beverages slowed to 5.2%, down from 5.7% the previous month. Within this, several categories eased, including cereals, seafood, dairy products, fruit, nuts and vegetables," said Kelly.
“The rate for cereal products retreated from 2,1% in July to 1,5% in August.”
Kelly explained that some staples, such as hot cereals, white rice, bread, and pasta, are cheaper now than they were a year ago.
However, some items remain notably expensive, including maize meal and samp.
“Beef products continue to register high annual rates. However, monthly price increases in August are the lowest since April this year," Kelly added.
Inflation remains within the Reserve Bank’s target range of 3% to 6%
Meanwhile, Standard Bank Group Head of South Africa Macroeconomic Research Dr Elna Moolman said inflation was slightly lower than expected.
“At some stage, this benign inflation will give scope for the Reserve Bank to give further interest rate relief," said Moolman.
“However, it's quite difficult to pinpoint the timing of such relief, especially given the Reserve Bank's new goal to anchor inflation and inflation expectations around the floor rather than the midpoint of its 3-6% inflation target.”
The Reserve Bank’s Monetary Policy Committee is due to announce the repo rate on Thursday.
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