South Africa’s inflation rate has witnessed a significant decrease, reaching its lowest level in more than a year, primarily driven by the declining prices of food and fuel. While the cost of food and non-alcoholic beverages remains relatively high, there are positive signs of improvement.
According to Statistics SA, headline consumer inflation in South Africa eased for the second consecutive month in May, dropping to 6.3% from April’s 6.8%.
This figure is the lowest inflation rate recording since April 2022, when it stood at 5.9%.
Food inflation, while still stubbornly high at 12%, has shown a notable decline from its record level of 14.4% in March. The annual rate for food and non-alcoholic beverages stood at 11.8% in May, lower than the previous month’s figure of 13.9%.
The price index for this category experienced a slight increase of 0.3% between April and May, marking the lowest monthly reading since November 2021, which was at 0.1%.
Several food and non-alcoholic beverage categories recorded lower annual inflation rates in May, indicating a positive trend, according to the statistics.
However, it is worth noting that sugar, sweets, desserts, and cold beverages saw an increase in inflation rates during this period.
“The month-on-month change in the consumer price index (CPI) was 0,2% in May.
The annual rate for food and non-alcoholic beverages (NAB) was 11,8%, lower than April’s print of 13,9%. The price index for this category increased by 0,3% between April and May, the lowest monthly reading since November 2021 (0,1%).
“Most food and NAB categories recorded lower annual inflation rates in May, with the exception of sugar, sweets & desserts, and cold beverages,” Statistics SA said on Wednesday.
It noted that fuel inflation also witnessed a decline, falling to 3.5% in May from 5% in April.
The easing inflationary pressures in South Africa are encouraging for the economy, as lower inflation can stimulate consumer spending and promote economic growth.
While food inflation remains a concern, the downward trend offers hope for improved affordability and a positive impact on consumers’ purchasing power.
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