(Serhii Hryshchyshen/Getty)
Annual consumer price inflation sank from 5.1% in June to 4.6% in July – the lowest level since July 2021, and within a whisker of the SA Reserve Bank’s target level of 4.5%.
This paves the way for an interest rate cut in September.
(Statistics SA)
Lower fuel prices in July helped to trim transport costs.
Also, prices of food and non-alcoholic beverages slowed further to 4.5% in July, from 4.6% in June.
Food inflation has slowed considerably from a high of 9% in November last year and is currently at its lowest level since the height of the pandemic, in September 2020.
Meat prices were 0.4% cheaper in July than in June – and just 1% higher than a year ago. Statistics SA says meat represents more than a third of household spending on food.
While bread and cake flour as well as pasta are now cheaper than a year ago, rice (+21% from a year ago), pizza and pies (+12%) and samp (+7%) were far higher. Instant coffee (+22%), black tea (+16%), ground coffee and coffee beans (+15%) and rooibos tea (+11%) were also much pricier than in July 2023.
(Statistics SA)
The inflation numbers in July include new tariff increases in most municipalities surveyed, some of which were milder than the previous year. Electricity tariffs increased by 12.1% (compared to 15.3% in 2023), while water tariffs rose by 7.5% (from 9.6% in 2023). But the increase in property rates (+10.7%) was higher than the 8.4% in 2023.
Statistics SA says water tariffs have now increased by an average of 9.9% per year over the past year, followed by electricity tariffs (+9.5%) and property rates (+6.6%).