Consumer inflation on the rise
27 January 2010
The Consumer Price Index (CPI) increased to 6.3% in December 2009, falling out of the South African Reserve Bank's inflation targeting range of 3-6%, as predicted.
"The headline CPI (for all urban areas) annual inflation rate in December 2009 was 6.3%," Statistics South Africa (Stats SA) reported on Wednesday. "This rate was 0.5 of a percentage point higher than the corresponding annual rate of 5.8% in November 2009."
Stats SA said the food and non-alcoholic beverages index decreased by 0.3% between November and December 2009. "This decrease was as a result of monthly decreases in vegetables, other food, fish and sugar among other goods."
The transport index increased by 0.6% between November and December 2009, mainly due to a 27c/l increase in the petrol price, Stats SA said.
"It came out below market expectations, most predicted that it would come in at 6.5% with the main reasons being the low base in petrol prices but the other thing is the decline in consumer durable goods," said Nedbank economist Carmen Altenkirch.
Market consensus was that it would rise to 6.4% year-on-year. She said it was likely that CPI would fall within the target range in March.
Reserve Bank Governor Gill Marcus said earlier this week that forecasts indicated inflation could measure around 6.5% in both December and January, before moderating in the subsequent months.
Source: BuaNews
