Finweek English Edition - - THE WEEK -

Con­sumer price in­fla­tion slowed to 6.1% year-on-year in May, com­pared with 6.2% in April and lower than econ­o­mists’ ex­pec­ta­tion of 6.3%. Food price in­fla­tion, which has been driven by a record drought and weaker rand, also mod­er­ated to 10.8% in May from April’s 11.3%. While the in­fla­tion data in­di­cates some breath­ing room for con­sumers’ pock­ets, it may also prompt the Re­serve Bank to hold rates steady at 7% when it meets in July. FNB said the Re­serve Bank may be swayed to hold rates by the weak do­mes­tic growth en­vi­ron­ment, the slightly lower in­fla­tion tra­jec­tory and a US Fed that is likely to pause its in­ter­est rate hik­ing cy­cle.

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