SARAH BULLEN, Cape Town | Wednesday 3.00pm
PRODUCER inflation, as measured by the change in the Producer Price Index (PPI), rose an annualised 5,5% in March, up from February’s rise of 5,0%, Statistics South Africa said on Wednesday.
From February to March PPI increased by 0,3%, while the seasonally adjusted index increased by 0,9%.
The rise in PPI is larger than expected, with a Reuters consensus poll of economists having forecast PPI would rise 0,25% from February to March, and an annualised 5,3%.
Stats SA said the annual increase of 5,5% in the PPI for all commodities for consumption is due to annual increases in the price indices of 4,2 percentage points for locally produced commodities and 1,3 percentage points for imported commodities.
A major contributor to the rise in PPI comes from the imported commodities section, which shows an annual rate of increase of 7,2% at March 1999, which is 1,1 percentage points higher than the corresponding annual rate of 6,1% at February 1999. This comes largely as a result of a 8,1% rise in the average price of imported crude petroleum.
Said JP Morgan economist Peter Worthington: “It looks as though a large element of oil prices is coming through because the imported component has jumped. The number is a touch above expectations, but I doubt the market reaction will be terribly adverse because people were forecasting a slight rise due to base effects and oil.”