South Africa Inflation Rate Below Expectations


Consumer prices in South Africa increased 4.7 percent year-on-year in June of 2015, slightly up from a 4.6 percent rise in May but less than market forecasts. Transport prices rebounded while cost of housing, utilities and food rose at a slightly slower pace.

The highest contribution came from prices of housing and utilities which rose 5.4 percent year-on-year but slower than a 5.6 percent increase in May. Water cost posted the highest increase (8.5 percent), followed by electricity and fuels (7 percent) and rents (5.4 percent). Cost of miscellaneous goods and services rose 7.2 percent (7.4 percent in May) and prices of food and non-alcoholic beverages went up at a slower 4.3 percent (4.7 percent in May). 

Additional upward pressure came tobacco and alcoholic beverages (up 9.7 percent, the same as in May), education (9.3 percent, the same as in May), clothing and footwear (up 5.6 percent compared to 5.4 percent in May) and restaurants and hotels (up 6.1 percent compared to 6.4 percent in May). Transport prices increased 0.7 percent, rebounding from a 0.7 percent drop in the previous month.

Annual core inflation rate, which excludes prices of food, non-alcoholic beverages, petrol and energy slowed to 5.5 percent from 5.7 percent in May, touching the lowest since May of 2014.

On a monthly basis, consumer prices increased 0.4 percent, following a 0.3 percent rise in May but also lower than expectations. The food and non-alcoholic beverages index decreased by 0.3 percent, driven by lower prices of fruit (-3.6 percent), vegetables (-1.8 percent), other food (-0.6 percent), bread and cereals (-0.2 percent) and fish (-0.2 percent) while increases were recorded for hot beverages (0.4 percent), oils and fats (0.3 percent), milk, eggs and cheese (0.2 percent), sugar, sweets and desserts (0.2 percent) and meat (0.1 percent). The housing and utilities index increased by 0.7 percent, mainly due to a 1.1 percent rise in actual rentals for housing and a 1.0 percent increase in owners’ equivalent rent. In addition, the transport index increased by 1.4 percent, mainly due to a 47c/litre increase in the price of petrol.

South Africa Inflation Rate Below Expectations


Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com
7/22/2015 9:31:39 AM