SA inflation rate falls to 17-month low

SOUTH Africa’s inflation rate fell within the Reserve Bank’s target band in April for the first time in eight months, reinforcing chances that the rate-increase cycle may have come to an end.

Consumer-price inflation eased to 5.3% from 6.1% in March, Statistics SA said in a report yesterday. It’s the lowest rate since December 2015 and compares with the median estimate of 5.6% by 20 economists surveyed.

The central bank’s Monetary Policy Committee, which announces its next interest-rate decision today, has kept the repurchase rate unchanged for six meetings after raising it, since January 2014 in a bid to keep price growth in its target range of 3% to 6%. All 21 economists in a survey forecast the key lending rate would remain unchanged.

Prices of food and non-alcoholic beverages rose 6.7% from a year earlier, the slowest pace since December 2015 and a fourth straight month of deceleration, Stats SA said. Corn prices have plunged 67% since reaching a record in 2016, as the country recovers from the worst drought on record. –Bloomberg