CPI increased by 5% in July – Stats SA

AUGUST 19, 2015

July’s annual CPI inflation rate increased by 5%, according to Statistics South Africa (Stats SA) on Wednesday.  

The rate was 0.3 of a percentage point higher than the corresponding annual rate of 4.7% in June 2015. On average, prices increased by 1% between June 2015 and July 2015.

The food and non-alcoholic beverages index increased by 0.1% between June 2015 and July 2015.  The annual rate increased to 4.4% in July 2015 from 4.3% in June 2015.

Food and non-alcoholic beverages that increased included hot beverages (0.9%), bread and cereals (0.5%), vegetables (0.4%), fish (0.3%), oils and fats (0.2%) and cold beverages (0.2%), while decreases included fruit (-2.5%), meat (-0.4%) and sugar, sweets and desserts (-0.3%).

The housing and utilities index increased by 3.1% between June 2015 and July 2015, mainly due to a 9.8% increase in water and other services and an 11.2% increase in electricity and other fuels. The annual rate increased to 6.4% in July 2015 from 5.4% in June 2015.

The inflation rate might seem low compared to reality, according to an inflation expert. That’s because you probably fall into a higher income bracket.

Over the last year, the most expensive products have increased by 17%, while the cheapest have decreased by 3%, The Inflation Factory (TIF) said on Tuesday.

“The massive difference in wealth between the ‘rich’ and ‘poor’ has a major effect on the different products that these groups buy and their respective inflation rates, but these differences are completely invisible if you only look at one lone CPI number.”

According to Bloomberg, the rand’s more muted effect on prices, mainly due to weak demand in the economy and increased competition among retailers, is benefiting the inflation outlook at the same time that oil prices trade near a six-year low of $50 a barrel.

“That gives Reserve Bank Governor Lesetja Kganyago scope to limit rate increases in an effort to support an economy hit by power shortages, falling commodity prices and strikes,” it reported.

 

---News24wire