South Africa Inflation Rate Hits 6-Month Low of 4%

The annual inflation rate in South Africa fell to 4.0 percent in July 2019 from 4.5 percent in June, well below market expectations of 4.4 percent and the mid-point of the Reserve Bank's target range of 3-6%. This is the lowest inflation rate since January, amid a decrease in fuels cost.

Year-on-year, inflation softened primarily for transport (3.0 percent vs 5.5 percent in June), as fuel cost declined (-0.5 percent vs 7.4 percent) reflecting lower international oil prices; and food & non-alcoholic beverages (3.4 percent vs 3.7 percent), of which processed food (5.1 percent vs 5.4 percent). Also, prices slowed for alcoholic beverages & tobacco (6 percent vs 6.1 percent); household contents and services (3.0 percent vs 3.1 percent) and restaurants & hotels (2.8 percent vs 3.5 percent). Meantime, inflation was steady for clothing & footwear (at 1.9 percent); education (at 6.7 percent) and recreation & culture (at 0.9 percent).

In contrast, cost rose faster for housing & utilities (5.1 percent vs 4.9 percent), namely electricity and other fuels (10.4 percent) and water and other sevices (7.1 percent) amid an increase in municipal tariffs with effect from July; miscellaneous goods & services (5.6 percent vs 5.4 percent) and health (5.4 percent vs 5.3 percent).

Annual core inflation rate, which excludes cost of food, non-alcoholic beverages, fuel and energy, dropped to 4.2 percent in July from 4.3 percent in the prior month and slightly below market estimates of 4.3 percent.

On a monthly basis, consumer prices went up 0.4 percent, the same pace as in the previous month and below market expectations of 0.7 percent.

South Africa Inflation Rate Hits 6-Month Low of 4%

Statistics South Africa | Luisa Carvalho |
8/21/2019 12:02:05 PM