Reuters reports that SA’s longer-term consumer inflation expectations fell to their lowest level on record, a quarterly survey showed on Monday.

Analysts, business people and trade unions now expect annual inflation to average 4.2% over the next five years, down from 4.4% in the second quarter survey. Inflation stood at 3.5% in July, the latest month for which data is available. “These downward revisions were made against the backdrop of the South African Reserve Bank's announcement of a change to the preferred inflation target at the end of July, just before the survey period,” the Bureau for Economic Research, which conducted the survey, indicated in a report. The Reserve Bank's next interest rate announcement is scheduled for 18 September.

Short-term inflation expectations were also revised down in the third-quarter survey, with forecasts for 2025 and 2026 averaging 3.8% and 4.2%, respectively, compared with 3.9% and 4.3% previously. Expectations for salary and wage increases also softened. Respondents now expect wage growth of 4.7% in 2025 and 4.8% in 2026, down from previous forecasts of 4.9% and 5.1%.

• Read the full original of the report in the above regard by Sfundo Parakozov at DailyDispatch
• Read too, Inflation expectations drop to record low as new target begins to shape sentiment, at BusinessLive (subscriber access only)

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