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JOHANNESBURG – May’s annual consumer price inflation slowed to 6.3 per cent from 6.8 per cent in April, with food prices finally cooling.
May’s inflation rate, which was also slowed by an easing in fuel prices, is the lowest since April 2022, Statistics SA said. It was also cooler than economists expected. The median expectation among economists in a Bloomberg survey was 6.5 per cent.
The consumer price index (CPI) increased by 0.2 per cent between April and May.
Food inflation – the prices of food and non-alcoholic beverages eased to 11.8 per cent from 13.9 per cent in April, which was close to the hottest level in fourteen years.
Food inflation only increased by 0.3 per cent between April and May – the smallest increase since November 2021.
Bread
Meat prices fell by 0.4 per cent from April to May and were 7.1 per cent higher than a year before – from 9.5 per cent in April. Bread and cereals inflation slowed to 18.1 per cent in May from 20.8 per cent in April.
Prices for oils and fats are now 2.4 per cent cheaper than a year before.
But sugar, sweets and desserts grew more expensive - increasing by 11.9 per cent in the year to May – from 10.7 per cent in April.
From April to May, the price of white sugar increased sharply by 2.7 per cent and slabs of chocolate by 2.9 per cent.
In the 12 months to May, the average price of a 2.5kg bag
May’s inflation rate, which was also slowed by an easing in fuel prices, is the lowest since April 2022, Statistics SA said. of white sugar increased from
R49.68 to R53. The average price of a slab of chocolate
(80 grams) rose from R17.11 to R20.26 over the same period.
Prices of cold beverages were
10.5 per cent higher in May from a year before – the highest rate since 2019.
Statistics SA also reported that restaurant prices increased by a sizeable 1.2 per cent between
April and May – taking the annual rate for restaurants to
7.4 per cent.
Expensive
Fish and seafood dishes were 11.3 per cent more expensive, followed by pizza (up 9.3 per cent) and red meat-based products (up 9.0 per cent).
Between April and May, the prices of pies were hiked by 2.3 per cent, followed by hikes of around two per cent for hot beverages, poultry-based products, hamburgers and red meat-based products.
While diesel and petrol prices were hiked in May, fuel prices were only 3.5 per cent higher than a year before - from 5.0 per cent in April. However, vehicle prices increased to 7.5 per cent the highest increase since 2017.
Statistics SA also noted sharp monthly price increases for pain killers (+3.0 per cent) and vitamin and mineral supplements (+6.6 per cent).
Reassure
The latest CPI number will reassure the Reserve Bank’s monetary policy committee, which has already hiked interest rates by 475 basis points in an effort to cool inflation.
Last month, interest rates were increased by 50 basis points. This came in the wake of a rand crash triggered by US allegations that Russia received arms in South Africa has raised inflation risks. A weaker rand fuels inflation.
SA imports almost all its fuel (in Dollars). Other imports will also be more expensive, but also locally produced maize and wheat.