SA February PPI seen steady at 5,5% y/y

South Africa’s February 2005 producer price index (PPI) is expected to remain at January’s 5,5% year-on-year (y/y) increase.

According to an I-Net Bridge survey of economists, the range is from 4,9% y/y to 5,9% y/y.

The optimists expect the stronger rand to have kept factory gate prices subdued, while the pessimists believe rising oil and other commodity prices will lead to higher producer prices.

Locally-produced inflation rose to 5,2% y/y in January from 4,6% y/y in December, while imported inflation eased to 6,4% y/y in January from 6,5% y/y in December, but remained below the 31-month peak of 6,8% y/y set in September.

Statistics South Africa will release the data at 11h30 on Thursday, March 30.

The average for 2005 was a producer inflation rate of 3,1% compared with an average of only 0,6% in 2004, 1,7% in 2003 and 14,2% in 2002.

The 2004 average was the lowest since 1959, when there was no change in producer prices. The lowest annual consumer inflation in the post-1945 period was also in 1959 at 1,1%. - I-Net Bridge

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