Year-on-year producer price inflation for all commodities for South African consumption (PPI) rose to 1,1% last month from 0,7% in July, Statistics SA said on Thursday.
This 0,4 of a percentage point increase could be explained by increases in the annual rates of change in the PPI for petroleum and coal products (from 9,2% in July to 9,9%), transport (from 0,1% in July to 0,5%), agricultural products (from -7,5% in July to -2,5%) and food at manufacturing (from -1,4% to -1,3%).
These higher rates of change were partly counteracted by annual decreases in the PPI for mining and quarrying products (from 17,5% in July to 15,1%) and electricity (3,3% in July to 1.2 percent), Stats SA said.
”From July 2004 to August 2004, the PPI for all commodities for South African consumption decreased by 0,1% while the seasonally adjusted index remained unchanged,” Stats SA said.
Rand Merchant Bank economist Ettienne le Roux said the drop in the electricity and mining and quarrying figures had been unexpected, and described them as odd.
”For some reason the high international oil prices are not coming through the figures yet,” he said.
Stats SA said the annual increase in the PPI was also due to an annual increase in the price index for locally produced commodities (up by 1,7%). This was partly counteracted by an annual decrease in the price index for imported commodities (-0,6%).
The PPI for locally produced commodities for consumption in South Africa rose to 2,3% last month compared to July’s figure of 1,9%.
This was due to ”relatively large increases” in the price indices for mining and quarrying products (0,9%), beverages (0,4%), petroleum and coal (0,3%), non-metallic mineral products (0,2%), basic metals (ferrous and non-ferrous)(0,2%), and metal products (0,2%), Stats SA said.
”The annual increases were partially counteracted by annual decreases in the price indices for agricultural products, paper and printing and textiles and made-up goods,” Stats SA said.
The PPI for imported goods was lower at -2,4% in August, down 0,4% from July’s figure of -2,8%.
This was mainly due to large annual decreases in the price indices of office, accounting and computing machinery, non-electrical machinery and chemical products.
Last month Le Roux predicted that despite subdued PPI inflation in July, the trend should be upwards from here on.
He reiterated on Thursday that the August PPI figures confirmed that inflation bottomed out at 0,7 in July and he was expecting a steady rise over the next while. – Sapa