South Africa Feb consumer inflation higher than forecast at 7.0% y/y
2023.03.22 05:09
© Reuters. A customer compares prices while shopping at a Pick and Pay shop in East London, in the Eastern Cape province, South Africa, March 17, 2023. REUTERS/Siphiwe Sibeko
JOHANNESBURG (Reuters) -South Africa’s headline consumer inflation rose slightly higher than expected to 7.0% year on year in February from 6.9% in January, data from Statistics South Africa showed on Wednesday.
On a month-on-month basis, consumer inflation was at 0.7% in February compared to -0.1% in the previous month.
Analysts polled by Reuters had predicted the year on year figure to come in at 6.9% and month on month at 0.6%.
The slight increase comes as South Africa has been dealing with rotational power cuts on a daily basis, hampering businesses and economic growth in Africa’s most industrialised economy.
The South African Reserve Bank targets inflation of between 3% and 6%. The central bank raised rates by a smaller than forecast 25 basis points in January as it cut its economic growth forecasts over the crippling power cuts.
The bank said inflation is expected to sustainably fall to the midpoint of its target range by the fourth quarter of 2024. It has raised interest rates at its last eight monetary policy meetings to tame inflation.
Core inflation, which excludes prices of food, non-alcoholic beverages, fuel and energy, was at 5.2% year on year in February, from 4.9% the previous month.
On a month-on-month basis core inflation was at 0.8% in February, compared to 0.2% in January.
