Consumer spending under pressure as CPI rises to 5.9%

Consumers’ spending power remains under pressure as inflation continues to rise locally and in the globally economy.

Numbers released by Statistics South Africa indicate that the annual consumer price inflation rate increased to 5.9% in March, up from 5.7% in February 2022.

Annual consumer price inflation was 5,9% in March, up from 5,7% in February. The CPI increased by 1,0% m/m in March 2022.

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— Stats SA (@StatsSA) April 20, 2022

The main contributors to the increase in inflation came from food and non-alcoholic beverages, housing and utilities, transport, and miscellaneous goods and services.

Chief Economist at Efficient Group, Dawie Root, says an interest hike is definitely on the cards.

“Inflation is likely to move up to above 6% in the next couple of months and that is the global phenomenon with inflationary pressures building up.  In these kinds of circumstances, there’s very little that central banks can do but increase interest rates and the South African central bank already indicated that they’ll keep in tapering monetary policy. So I think it’s pretty much a given now that the Reserve bank will again increase interest rates next month.”