In shopping baskets across South Africa there is a hint of good news, that the high inflation of recent months may have peaked and could be on its way down
In shopping baskets across South Africa there is a hint of good news, that the high inflation of recent months may have peaked and could be on its way down.
Price increases on basic food stuff had slowed according to the Pietermaritzburg Economic Justice and Dignity (PEJD) project. The PEJD releases their household Food Basket, which tracks the price of a number of basic items that are purchased by lower income households in cities across the country.
Their latest figures for the end of August showed that month-on-month the national household basket had increased by R26.72 or by 0.6%.
This is the second consecutive month that has shown a lowering of inflation on the basket prices.
Two cities even experienced a monthly decrease in the cost of the baskets. The Cape Town household basket fell by R23.63 or -0.5% and in Durban the price decreased by R44.11 or -0.9% month-on-month.
This inflationary slowdown has also been seen globally.
“I think the trend at the moment looking at America’s inflation is that they have peaked. So we are expecting South Africa to start peaking. Things will slowly start coming down,” said Dr Lumkile Mondi of the School of Economics and Business Science at the University of the Witwatersrand.
However, for millions of South Africans even though inflation may be slowing, the high cost of food is still a crisis they can’t afford.
“What working-class households are telling us is that to survive they have had to cut out a meal a day,” explained Abrahams.
“People are also telling us that they are trying to take out as much debt as they can.”
While lower food prices may help families, other rising costs are adding their own pressures.
“It just shifts the burden from one area to another. Part of our problem is the low levels of wages, and the high levels of inequality in South Africa,” said Abrahams.
South Africans aren’t alone in their fears over rising costs.
A survey conducted by YouGov and Datapraxis in 22 countries found that there were high levels of anxiety about potential food shortages in low- and middle-income countries. In South Africa, 77% of respondents “often worry about whether my family will go hungry”. This compared to 69% in Brazil, and 90% in Colombia.
It also comes as Statistics SA revealed this week that SA’s GDP had decreased by 0.7% in the second quarter of 2022, following growth in the first quarter. High levels of load shedding over the past couple of months were to blame.
Seven out of the 10 industries surveyed by Stats SA recorded declines in the second quarter.
But with the inflation peak already reached there might be some good news ahead.
“With oil coming down, and with it food prices we envision some respite over Christmas,” said Mondi.
