South Africa’s producer price inflation slowed slightly more than expected to 7,3% year-on-year in February from 9,2% in January, official data showed on Thursday.
Statistics South Africa said on a monthly basis PPI, representing domestic output, was -0,3% compared to -0,7% in January.
Imported commodities inflation stood at -8,8% year-on-year in February compared with -5% the month before, while exported commodities inflation was at 1,6% year-on-year from 2,6% before.
Economists polled by Reuters last week forecast that annual PPI would decelerate to 7,4% in January and be at -0,2% on a monthly basis.
Fanie Joubert, economist at Efficient Group, said: ”It’s lower than expected. But some of the major items like basic metals and chemical products — responsible for the slower rise — are not related to
the consumer basket.
”However, overall, the continued deceleration trend is still positive.”
Mike Schussler, economist at Economists.co.za, said the figure was very good news.
”It is absolutely good news after the disappointing CPI figure earlier this week. I suspect that it is mostly due
to collapsing commodity prices. PPI’s downward trend is driven by lower commodity prices while CPI is driven higher by services fees. We see CPI staying high because of the hikes we are seeing in service costs such as doctors’ fees and medical aid costs, while the PPI is only expected to move up when Eskom’s new tariffs feed through.”
Dennis Dykes, economist at Nedbank, said the figure came slightly below the consensus.
”But, overall, producer inflation will continue to come down over the next few months.” – Reuters, I-Net Bridge