The increase in South Africa’s consumer price index excluding mortgage rate changes (CPIX) for metro and other areas, which is used by the South African Reserve Bank (SARB) for its inflation target, was up 5,3% year-on-year (y/y) in January from 5% in December, Statistics South Africa (Stats SA) said on Wednesday.
CPIX was up 1% month-on-month (m/m) after it increased by 0,1% m/m in December.
Headline consumer prices — the 12-month rate of change in the consumer price index (CPI) for metropolitan areas — was up 6% y/y in January from a 5,8% y/y increase in December.
The core inflation rate, which excludes volatile foods, municipal rates and monetary policy changes, was up 4,1% y/y in January from 3,8% in December.
CPIX was expected to have increased to 5,2% in January, an I-Net Bridge survey found. Three economists expected it to break below 5%, while nine of the 14 economists expected an increase above 5%.
Mike Schussler, an economist at T-Sec, said: “Both CPIX and CPI were a bit above expectations and I think this again puts the cat among the pigeons vis-a-vis interest rates.”
Dennis Dykes, a Nedbank economist, said the CPIX and CPI was a bit higher, but “within the forecast band”.
Kabelo Masike, Eskom treasury economist, said the numbers were pretty much in line with expectations and reflected some inflationary pressures.
“But forward looking, I don’t think it’s anything alarming.” – I-Net Bridge