adminJohannesburg — South Africa’s consumer inflation rate rose to 4.6 percent in May, the highest level this year and 0.1 of a percentage point higher than the corresponding annual rate of 4.5 percent in April 2015. On average, prices increased by 0.3 percent between April 2015 and May 2015, Statistics SA announced yesterday.
The core inflation rate, which excludes food, non-alcoholic beverages, fuel and electricity costs, rose to 5.7 percent in May from 5.6 percent in April.
The food and non-alcoholic beverages index increased by 0.6 percent from April to May, while the annual rate decreased to 4.7 percent in May from 5.0 percent in April.
The components in the food and non-alcoholic beverages index contributing to the increase were fish (2.6 percent); bread and cereals (1.9 percent); other food (1.7 percent); sugar, sweets and desserts (1.3 percent); oils and fats (1.2 percent); cold beverages (0.9 percent); milk, eggs and cheese (0.7 percent); and hot beverages (0.1 percent).
The components which decreased were fruit (-4.6 percent) and vegetables (-1.4 percent). The transport index increased by 0.3 percent between April 2015 and May 2015. The annual rate lifted to -0.7 percent in May from -1.1 percent in April.
The provinces with an annual inflation rate lower than or equal to headline inflation were Gauteng (4.6 percent), North West (4.5 percent), Eastern Cape (4.4 percent), Mpumalanga (4.2 percent), KwaZulu-Natal (3.7 percent) and Limpopo (3.4 percent). The provinces with an annual inflation rate higher than headline inflation were Western Cape (5.1 percent), Free State (5.1 percent) and Northern Cape (4.8 percent).
Jacques du Toit, property analyst at Absa Home Loans, said headline consumer price inflation is forecast to rise for the rest of the year, with interest rates to be hiked before year-end and through 2016.
The South African Reserve Bank (Sarb) has kept the repo rate unchanged at 5.75 percent since July 2014, but has cautioned that the risks to inflation have increased. — Fin24.
Bongani Ndlovu
Online Reporter