Inflation data for May, due for release on Tuesday, is expected to show a continuation of the upward trend in prices with both the headline and core inflation measures rising sharply to 8.7% from 8.0% the month before, SCMB Securities said at the weekend.
The important benchmark measure, CPIX, was similarly expected to increase to 9.5% from 8.8% in April, fuelled by petrol and food price increases.
A 7.2% increase in the monthly petrol price and price adjustments to new and retread tyres, parking fees and bus tariffs were expected to add some 0.5% to the estimated 1.1% monthly rise.
Food price increases along with increases in the prices of winter clothing, household operating costs and other miscellaneous items would make up the balance.
”Any hope that these increases would represent the peak of the inflation cycle are, however, premature.”
Producer price inflation, due for release in two weeks, was expected to remain unchanged from the 14.8% high recorded in April.
”Unfortunately, PPI is expected to remain high over most of the year, averaging around 13.6%.
”A sharp decline is, however, expected in 2003 as the effect of the rand’s depreciation works itself out of the price system.” – Sapa