South Africa Inflation Rate at 2-Year High

South Africa's annual inflation rate accelerated for a fourth consecutive month to 5% in June 2026 from 4.5% in May and above expectations of 4.7%. This marked the highest inflation rate since June 2024, driven primarily by a sharp increase in transportation costs (12.7%), largely reflecting a 34.3% surge in fuel prices amid elevated global energy prices linked to the conflict with Iran. Additional upward pressure came from housing and utilities (5.5%), led by higher prices for electricity, gas and other fuels (3.9%) and water supply (6.9%). Inflation also remained elevated for insurance and financial services (5.9%), restaurants and accommodation services (5.1%), and alcoholic beverages and tobacco (3.6%), while food inflation edged up to 1.6%. Meanwhile, core inflation rose to 4.1%, its highest level since September 2024, pointing to broader underlying price pressures. On a monthly basis, consumer prices increased 0.7% in June.

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.