South Africa’s inflation rate rose more than expected and breached the central bank’s target range for the first time in more than five years.
Statistics South Africa said annual inflation accelerated to 6.5 per cent in May, from 5.9 per cent a month prior.
In a statement on its website on Wednesday, Statistics South Africa said this was the highest level since January 2017. Reads the statement seen by Pindula News:
The impact of fuel prices
Transport and food and non-alcoholic beverages (NAB) accounted for just over half of the annual rate, with sharp price increases recorded in both categories. Fuel, in particular, continues to be a major contributor: if the impact of fuel is removed from the CPI reading in May, the headline rate falls to 5.1% from 6.5%.
Diesel prices jumped by 8.1% between April and May, taking the annual rate to over 45%. The average price of a litre of diesel in May 2021 was R16,20 – meaning it cost R729 to fill a 45-litre tank. Twelve months later, with the average price at R23.67 per litre, filling the same tank cost R1 065.
Petrol prices moderated between April and May, edging lower by 0,7%. Despite this decline, petrol is almost 27% more expensive than it was in May 2021.
Cooking oil prices continue to soar
Prices for food and NAB jumped by 2.1% between April and May, representing the largest monthly increase since February 2016 when the monthly rise was also 2.1%. At that time the country was experiencing a severe drought.
The oils and fats product group continues to witness sustained levels of high inflation.
With Zimbabwe importing most of its commodities from South Africa, it means it is also importing inflation.