by Stanley Karombo
JOHANNESBURG, Sept. 20 (Xinhua) -- The South Africa inflation jumped to 4.8 percent year-on-year in August from 4.6 percent in July, according to figures released by Statistics SA on Wednesday.
The consumer price index (CPI) climbed up as expected by the market, thanks to the increases in the fuel price.
"It was expected that fuel induced inflation would jump to 4.9 percent," Rand Merchant Bank analyst Gordon Kerr said in an investor meeting on Wednesday in Johannesburg.
The August inflation figures are still within the Reserve Bank bases of 3 to 6 percent target and has been within that band since April this year.
The food inflation decelerated to 5.7 percent year-on-year in August from 6.8 percent in the previous month.
"This is the lowest levels since November 2015, thanks to good summer rain, which led to a higher agricultural output. While we expect further moderation in the next few months, the picture of the food basket remains mixed," Wandile Sihlobo an economist at Agbiz told Xinhua on Wednesday.
"All food products have decelerated, with the exception of meat which remains stickier, recording 15 percent year-on-year in August 2017, which is the highest level since December 2011. This is on the back of the spreading avian influenza and cattle restocking process after the 2015-16 drought," he added.
The increase in meat inflation came as no surprise given that over 3 million birds have been culled or died due to the spread of avian influenza.
In addition, the ongoing cattle restocking process also adds to the uptick in the meat inflation. Farmers slaughtered 203,647 heads of cattle in July, which is 13 percent lower than the corresponding period last year, according to data from the Red Meat Levy Admin.
Meanwhile, the market expects the monetary policy committee (MPC) to announce a cut in the interest rates on Thursday.
Breads and cereals prices fell 1.2 percent in August from a year earlier, after a 2-percent increase in July, according to the figures released. Enditem
