Producer inflation increases

PRODUCER inflation accelerated last month‚ with the producer price index (PPI) rising 7.4% year on year‚ after a 6.8% increase in June.

The PPI for final manufactured goods was expected to have accelerated marginally to 6.9% last month‚ from 6.8% in June‚ according to a median consensus forecast from a survey of six economists. Producer inflation ultimately feeds into consumer inflation‚ which the Reserve Bank targets for monetary policy.

Consumer inflation slowed to 6% last month‚ Statistics SA’s CPI data showed on Wednesday.

The inflation outlook has become clouded after the rand’s run of strength was brought to an abrupt halt on Tuesday. – BDlive