Economists say the recent social unrest characterised by mass looting and vandalising of infrastructure will result in some upward inflationary pressures in the short-term.
Figures by Statistics South Africa (SSA) show that the annual consumer price inflation was 4,9% in June 2021, down from 5,2% in May 2021.
The main contributors to the 4,9% annual inflation rate were food and non-alcoholic beverages, housing and utilities, transport, and miscellaneous goods and services.
Economist at Econometrix Laura Campbell says headline inflation will eventually stabilise as the year progresses.
Campbell says, “Weak demand in the domestic economy is expected to have constrained the inflation rate in June. Looking further ahead is the fact that the looting and protest that took place in recent days could lead to shortages of goods including food and medicine, this supply-side shock will push inflation higher in the short term but it should subside when things return to normal.”
SSA to release consumer inflation data for June:
National Consumer Commission urges public to report overpricing of goods
The National Consumer Commission is urging members of the public to report any overpricing following mass looting in KwaZulu-Natal and Gauteng last week.
The commission says hefty fines and even jail time will be handed down to businesses found guilty of inflating prices of essential items.
Spokesperson Pheth’uo Ntaba says, in particular, they will be monitoring the prices of basic food supplies like bread, milk and emergency products.
“Where we find that suppliers increased their prices unfairly, we will then take that particular supplier to the tribunal whereby we will be praying for a maximum penalty or administrative fine of up to R1 million or up to 10% of that particular supplies annual turnover,” says Ntaba.
Ntaba says in instances where their investigation team reveals that there was an element of crime, they will take the matter up with the National Prosecuting Authority where a supplier or the director might face 12 months imprisonment.
KZN businesses count their losses following looting: