BusinessTech reports that according to Investec chief economist Annabel Bishop, South African consumers face little reprieve in the coming months as both fuel and food prices look set to increase further.
Commenting on Statistics SA’s latest consumer price index (CPI) data, Bishop noted transport inflation rose from 15% year-on-year in November to 16.8% tear-on-year in December, as petrol prices rose by 75c/litre. “While there was a 68c/litre cut in January, a huge increase of around R1.30/litre is building for February on the back of a rising global oil price,” Bishop warned. Looking ahead, food price inflation is expected to climb higher as heavy rains have caused crop damage and delayed planting, Bishop noted. “Lower yields are thus expected for crops such as sunflower seeds, maize, sorghum, soybeans, other dry beans and peanuts. The current La Nina phenomenon, expected to last until autumn, causes extreme rainfall, in contrast to the dry conditions of Le Nino.” Investec now expects CPI inflation to average closer to 5.3% y/y for 2022, as the December figure established a higher base for the 2022 CPI figures. The latest consumer price index shows that annual headline inflation jumped to 5.9% in December 2021, up from 5.5% in November 2021. This is the highest annual increase since March 2017 when the rate was 6.1%,
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