Cape Town – The average annual consumer price inflation for 2017 remained within the government's 3% to 6% target band.
According to data from Statistics South Africa released on Wednesday, the average annual consumer price inflation was 5.3% in 2017 (ie the average consumer price index for all urban areas for 2017 compared with that for 2016). This was 1.1 percentage points lower than the corresponding average of 6.4% in 2016.
Inflation for December was 4.7%, up from 4.6% reported in November, with a month-on-month increase of 0.5%.
For the monthly inflation, contributors were food and non-alcoholic beverages with 0.1 of a percentage point. Housing and utilities contributed 0.1 of a percentage point in December, while transport contributed 0.2 of a percentage point.
Inflation for goods increased 4.1% year-on-year (y/y) for December, and the inflation for services increased 5.3% y/y.
Earlier this week, FNB chief economist Mamello Matikinca said she expected inflation to be higher than that for November, mainly driven by the fuel hike in December.
Inflation is expected to moderate in January before reaching a 4.5% trough in March, she said.
FNB Senior Economic Analyst Jason Muscat reiterated views that the “bump” in inflation was driven by petrol price inflation, up 14.2% year-on-year. “With mild fuel price relief earlier this month, we expect January inflation to ease back to 4.6% year-on-year.”
Investec chief economist Annabel Bishop expects inflation to pick up from the second quarter of the year.
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