South Africa inflation at highest level in 4 months ahead of rate call

BREAKING NEWSMarch 22, 2024 at 12:50 PM UTC

TLDR

South Africa's inflation rate reaches four-month high at 5.6% in February.
Economists predict central bank to keep interest rates unchanged until the third quarter.
Core inflation, excluding food and fuel prices, rises to 5.0% annually in February.

South Africa's inflation rate surged to a four-month high, signaling a likely stance of unchanged borrowing costs from the central bank in its upcoming meeting next week.

Statistics South Africa reported that the consumer price index rose to 5.6% in February compared to a year earlier, up from 5.3% in the prior month. This figure slightly exceeded the median estimate of 5.5% from a Bloomberg survey of 17 economists.

Economists anticipate that the central bank will maintain its current interest rates until the third quarter of the year, according to a February poll. Core inflation, which excludes volatile food and fuel prices, also increased in February to 5.0% on an annual basis, up from 4.6% in January.

Key Takeaways

Inflation, the increase in prices of goods and services over time, has emerged as a significant concern for numerous countries both within and outside of Africa over the past year. Inflation can have varying degrees and causes, but overall, it diminishes the purchasing power of individuals, impacts the economy, and even poses challenges for the government. As for South Africa, the factors pushing inflation upward have strengthened in recent months. This has introduced greater uncertainty regarding the exact trajectory of consumer prices.

South Africa

Inflation

Interest Rates

South African Reserve Bank

Economy