South Africa’s producer price inflation (PPI) quickened to 19,1% year-on-year in August from 18,9% in July, slightly below expectations, official data showed on Thursday.
Statistics South Africa said month-on-month PPI, representing domestic output, was in line with forecasts at 0,5% compared with 2,7% previously.
Economists polled by Reuters last week forecast that annual PPI would accelerate to 19,2%.
Imported commodities inflation was marginally up at 23% in August compared with 22,8% the month before.
Danelee van Dyk, economist at Standard Bank, said: ”It’s lower than expected and it shows that the momentum in factory-gate prices is fast running out of steam. This could be the peak in PPI.”
According to Doret Els of the Efficient Group, ”the figure is in line with what we expected. We were expecting 19,1%. The figure is still high, but perhaps we could see inflation coming down slowly towards the end of the year.”
Annabel Bishop, economist at Investec Group, said: ”PPI inflation came out slightly lower than expected, but still managed to record a twenty-two year high. Lower rand oil prices contributed, but there is continued evidence of additional price pressures from a broad range of items.
”The record-high CPIX figure showed significant evidence of broad-based price pressures as well, and is another reason prompting the recent bearish comments from the South African Reserve Bank. While the risk of another interest-rate hike this year is rising, we still do not think it will materialise.” — Reuters, I-Net Bridge