This was the lowest reading in four months, edging closer to the South African Reserve Bank’s preferred 4.5% midpoint of the 3-6% target range.
CONSUMER prices in South Africa slowed for the second month in a row as inflation cooled for bread, cereals, oils and fats.
Statistics South Africa (StatsSA) said on Wednesday that the headline consumer price index (CPI) pulled back in December, easing to 5.1% from 5.5% in November and 5.9% in October.
This was the lowest reading in four months, edging closer to the South African Reserve Bank’s preferred 4.5% midpoint of the 3-6% target range.
StatsSA said the annual core inflation was steady at 4.5% in December, aligning closely with market forecasts of 4.6%.
On a monthly basis, the CPI was unchanged in December after falling 0.1% in November.
StatsSA chief director for price statistics Patrick Kelly said prices decelerated mainly for food and non-alcoholic beverages, from 9.0% in November to 8.5% in December.
These included items such as bread and cereals, oils and fats, sugar, sweets and desserts, vegetables and hot beverages.
“The bread and cereals price index declined by 0.2% between November and December, lowering the annual rate for this category to 7.5%. Maize meal prices eased by 0.9% over the same period, with the average price of a bag of maize meal (2.5kg) declining from R37.04 in November to R36.64 in December,” Kelly said.
“Inflation for oils and fats remained in deflationary territory, recording an annual change of -5.9% in December. Cooking oil prices dropped by 1.6% between November and December.
“The average price for a 750ml bottle of sunflower oil was R35.82 in December, lower than the February 2023 peak of R37.47 and well below the high of R45.33 recorded in July 2022.
“Although the sugar, sweets and desserts category as a whole recorded a softer annual rate in December, sugar prices continued to escalate. White sugar is 20.1% and brown sugar 24.6% more expensive than a year ago.”
The December CPI release concluded the results for 2023, which showed that inflation was softer in the second half of 2023.
StatsSA said the average inflation rate for the year was 6.0%, lower than 6.9% recorded in 2022.
Inflation was relatively hot in the first five months of 2023 (January to May), with the headline rate consistently above 6.0%, but it eased below this level for the remaining seven months of the year.
The highest reading in 2023 was 7.1% in March, while the lowest was 4.7% recorded in July.
Meanwhile, Kelly said poultry and egg prices continued to heat up in December, including meat, milk, cheese, fish, fruit and ‘other’ food.
– BUSINESS REPORT
