South Africa Inflation Rate Accelerates, Still Below Forecasts

South Africa's annual inflation rate rose for the third month to 4.5% in May 2026, marking the steepest since July 2024, though below the expected 4.7%. Inflation was mainly driven by transportation (9.4% vs 4.9% in April) and housing & utilities (5.3% vs 5.2%), reflecting pass-through from higher fuel costs due to the Middle East conflict and Eskom’s recent electricity tariff hike. Additional upward pressure came from insurance and financial services (5.7% vs 5.7%) and restaurants & hotels (5.8% vs 5.2%). Meanwhile, food inflation continued to ease (1.9% vs 2.9%). The core inflation rate, which excludes prices of food, non-alcoholic beverages, fuel, and energy, rose to an over 1-1/2-year high of 3.8% in May, up from 3.6% in the previous month. Monthly, the CPI rose by 0.7% in May, down from a 1.1% increase in the prior month.

South Africa’s annual inflation rate quickened to 4% in April 2026 from 3.1% in the prior month and slightly above the expected 3.9%. This marked the steepest reading since August 2024, moving further away from the South African Reserve Bank’s 3% inflation target. Main upward pressure came from housing and utilities (5.2% vs 5.1% in March), driven by a recent increase in electricity tariffs, and transportation (4.9% vs -1.6%), as petrol prices were raised in early April, with a lagged pass-through from higher global oil prices linked to the Iran war also contributing. Meanwhile, food price growth eased further (2.9% vs 3.6%) amid strong farm output, while prices also slowed for restaurants and hotels (5.2% vs 5.9%). The core inflation rate, which excludes prices of food, non-alcoholic beverages, fuel, and energy, rose to 3.6%, the highest since December 2024, up from March's 3.2%. Monthly, the CPI rose by 1.1% in April, the most since July 2022, after a 0.6% increase in March.

South Africa’s annual inflation rate edged up to 3.1% in March 2026 from 3% in the prior month, matching market expectations. In March, the impact of the Middle East conflict was only starting to feed into domestic prices. The main positive contributors were housing & utilities (5.1% vs 4.8% in February); food & non-alcoholic beverages (3.6% vs 3.7%) and insurance and financial services (4.6% vs 4.5%). In the meantime, prices fell at a slower pace for transportation (-1.6% vs -2.1%). The annual core inflation rate, which excludes food, non-alcoholic beverages, fuel, and energy, rose to 3.2% from a seven-month low of 3.0% in the prior month. On a monthly basis, the CPI rose by 0.6%, after a 0.4% increase in the prior month.