On the business front, data out this week shows that consumers could face more general price increases in the coming months. Figures released by Statistics South Africa indicates that consumer price inflation has increased to 3.2% in January from 3.1% in December 2020.

Consumers are also in for a hefty rise in electricity price after the National Energy Regulator of South Africa (Nersa) agreed to Eskom’s request for tariff increase of over 15% for the 2021/2022 financial year

Already battling with high indebtedness and rising unemployment rate, consumers will likely be hit with a slew of price increases.

Data out this week shows that a significant fuel price hike for March is on the cards.

Petrol price likely to increase

If current market trends persist until the end of February, the petrol price is likely to rise by around 50 to 55 cents a litre, while diesel could go up by about 45 cents a liter.

The annual tabling of the national budget next week could to add more financial woes to consumers.  Motorists have been warned to expect increases in the fuel levies from the budget anything between 15 and 20 cents.

Report on January fuel price increase:

 

Inflation expected to remain the same

Despite these increases, inflation is expected to remain within the Reserve Bank’s 3 to 6% target range.

This week’s decision by energy regulator Nersa to allow Eskom to recover an extra R6bn from consumers will place additional burden of consumers.

Rand strengthening

Good news is that the local currency continued to defy predictions as it strengthens to below R15 against US dollar.

The rand rose 0.3%, extending gains to a third consecutive session, with investors keenly looking forward to an update on the fiscal status of the local economy from Finance Minister Tito Mboweni in his budget speech on Wednesday.