Consumer price inflation (CPI) slowed to 2,9 percent year-on-year in February from 3,2 percent in January. According to data from Statistics South Africa, this is the lowest reading since June last year.
The biggest contributors to the decline came from lower increases in medical services and food inflation. The data shows that higher fuel price increases didn’t add significant upward pressure on consumer inflation.
Core inflation, which excludes prices of food, non-alcoholic beverages, fuel and energy, was at 2,6 percent year-on-year in February, from 3,3 percent previously.
Statistics South Africa’s Patrick Kelly, “Households are paying on average 4.3 percent more for medical-related services than they did a year ago. This increase is lower than the annual rate recorded in 2020 of 9 percent. Annual inflation for food and non-alcoholic beverages was 5.2 percent in February, down from the 6 month high of 6 percent recorded in December. At 4.6 percent annual bread and cereal inflation was slightly off from its 12 month high of 5.1 percent in January. White bread increased by 8 percent while super maize meal declined by 3.5 percent.”
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The rand is trading at 14, 87 to the dollar, 20, 35 to the pound and 17, 56 to the euro.
Markets in Asia ended lower. Japan’s Nikkei as well as Hong Kong’s Hang Seng declined by two percent, mainland China’s markets closed 1,3 percent weaker, while markets in India are currently around one percent down.
The JSE is also lower in mid-morning trade. The All Share Index has shed 1,3 percent to 64 445, the Industrial 25 Index is one percent weaker, the Top 10 Resources Index has declined by 1,5 percent and Financials are nearly one percent down.
On the capital market, the yield on the R-186 government bond is at 7,5 percent and the yield on the R-2030 is at 9,38 percent.
Markets in Europe are around one percent weaker at this hour, while gold is trading at 1 728 dollars and platinum at 1 168-dollars per ounce. The price of Brent crude oil is at 61, 45 dollars a barrel.
