Home South African Inflation stable in May

Inflation stable in May

198

South Africa’s headline consumer inflation came in at 5.2% year-on-year in May, the same as in April, statistics agency data showed on Wednesday.

StatsSA further said that sfter five consecutive months of decline, food and NAB inflation remained steady at 4,7% in May, unchanged from April.

SOUTH Africa’s headline consumer inflation came in at 5.2% year-on-year in May, the same as in April, statistics agency data showed on Wednesday.

In month-on-month terms, inflation was at 0.2% in May compared to 0.3% a month before, Statistics South Africa said.

The South African Reserve Bank has kept its main interest rate at its highest level since 2009 for more than a year to try to steer inflation to 4.5%, the midpoint of its target band.

The central bank said at last month’s monetary policy meeting that it remained concerned over elevated inflation expectations, estimating that inflation would only stabilise at 4.5% in the second quarter of 2025.

FOOD INFLATION STALLS

StatsSA further said that after five consecutive months of decline, food and NAB inflation remained steady at 4.7% in May, unchanged from April.

Bread and cereals continued to trend downward, slowing further to 3.9%.

This was the lowest annual reading for bread and cereals since February 2022 when the rate was 3.7%.

Nine of the 30 bread and cereal products in the inflation basket are cheaper than a year ago.

Rusks, hot cereals, pasta and savoury biscuits registered the largest price decreases. Inflation remains notably hot, however, for rice, pizza and pies, sweet biscuits, cakes and tarts and bread rolls.

Milk, eggs and cheese inflation moderated for a fifth consecutive month, on the back of slower price increases for cheese, selected milk products and eggs.

The annual rate for eggs remains elevated at 21.0% but is softer than April’s 25.1%.

Inflation for sugar, sweets and desserts also continued a downward trajectory, dampened by lower rates for sugar, jam, chocolate and ice cream.

Although sugar inflation cooled in May, annual increases for both white and brown varieties remain in double-digit territory, at 18.8% and 15.8% respectively.

May saw an uptick in inflation for hot beverages, oils and fats, fish, fruit, vegetables and meat.

Hot beverages quickened from 11.4% in April to 14.2% in May, the highest since January 2023 (16.4%).

Inflation for instant coffee, ground coffee or coffee beans and black tea stands above 10%. Instant coffee prices rose by an annual 17.9%, up from 13.8% in April.

Digging a little deeper into the data, the average price for instant coffee (250 g) was 82% higher in May 2024 than in January 2017 (when Stats SA started publishing average prices).

Many coffee drinkers enjoy sugar and milk in their favourite brew, and these have also risen in price over the same period, although not as sharply as coffee.

OTHER NOTABLE PRICE CHANGES

With winter chills currently setting in, the price for cold & flu medication witnessed an annual rise of 11.1%.

Other health-related products that recorded relatively large increases include eyedrops (up 15.9%), laxatives (up 11.3%), cough syrup (up 8.1%) and vitamins (up 7.1%).

Despite these increases, overall inflation for health products cooled from 7.7% in April to 5.8% in May.

Transport quickened to 6.3% from 5.7% in April. This is the highest rate for the category since October 2023 (7.4%).

Fuel was the major culprit, with petrol and diesel prices increasing on average by 9.3% over the last 12 months (and by 0.6% since April 2024).

The index for restaurants and hotels rose by an annual 6.5%. Hotel prices were up by 8.0% over the same period, with hotels in Gauteng, Free State and Limpopo registering increases higher than 10%.

The miscellaneous goods and services category recorded an annual rate of 7.1%, slightly softer than 7.2% in April.

Personal care products recorded a fifth consecutive month of disinflation, slowing to 7.0% in May from a recent high of 10.3% in December 2023.

Personal care products with the highest inflation rates in May were baby powder (up 18.4%), shampoo (up 16.6%), toothbrushes (up 16.5%) and toothpaste (up 16.1%).

– BUSINESS REPORT and REUTERS

Previous articleWales flanker Morgan ruled out of Twickenham Test against Boks
Next articleWomen Proteas bidding for better batting show says all-rounder Nadine de Klerk