Annual Consumer Price Inflation (CPI) has come in at 5.9 percent for April 2022.
It is unchanged from the previous month. Statistics South Africa data shows that CPI index increased by 0.6 percent month-on-month last month.
— Stats SA (@StatsSA) May 18, 2022
Earlier, economists said inflationary pressures are coming from food and high fuel prices. In April, the price of a litre of petrol increased by between 28 and 36 cents depending on the grade.
While a litre of diesel had a steep increase of between R1,52 and R1,68.
A larger increase was countered by the R1,50 reduction in the fuel levy, bringing some relief to consumers. Food prices have also been on an upward trajectory, global supply chain problems are to mainly to blame.
Standard Bank Chief economist Goolam Ballim said, “We’ll continue to see pressures from food, grain prices especially and of course elevated fuel prices with the more recent weakness in the rand does pose cumulative upside risks to the consumer price index over the coming months as well, all end, we anticipate further monetary policy tightening by the SARB as a consequence of this elevated inflation readings which are very close to the ceiling SARB 3-6% target band.”
The Reserve Bank is likely continue to hike interest rates as a result of the high inflation and the upside pressures going forward.
Chief economist at Investec Annabel Bishop said, “South Africa see the MPC meet this week on Thursday, it’s expected they’ll hike the repo rate by 50 basis points , this is what the markets expects and the SARB tend to follow…in July as well.”