Consumer prices in South Africa softened to a 7-month low in December on the back of a slow down for transportation, but the average rate of increases over the course of 2022 remained elevated above the target range.
Statistics South Africa (Stats SA) said on Wednesday consumer price inflation edged lower to 7.2% year-on-year in December 2022 from 7.4% in November and 7.6% in October.
The inflation print slowed for the second month in a row in December, and was the softest reading since May, when it was at 6.5%.
However, the 6.9% inflation average for 2022 is still above the upper limit of the South African Reserve Bank’s target range of 3-6% and might force the central bank to maintain its hawkish monetary policy stance.
Stats SA said the main contributors to the 7.2% annual inflation rate in December were food and non-alcoholic beverages; housing and utilities; transport; and miscellaneous goods and services.
Transport inched higher by 13.9% year-on-year, while miscellaneous goods and services increased by 4.9% during the same period.
Food and non-alcoholic beverages increased by 12.4% year-on-year, while housing and utilities rose by 4.1% year-on-year.
On a monthly basis, consumer prices were up by 0.4% in December, following a 0.3% rise in November, and slightly above market forecasts of a 0.3% increase.
Core inflation, which excludes the prices of food, non-alcoholic beverages, fuel and energy, eased to 4.9% year-on-year in December, from an over 5-and-a-half-year high of 5% in November.
Stats SA’s data showed that the average annual consumer price inflation of 6.9% in 2022 was uch higher than the corresponding averages of 4.5% in 2021 and 3.3% in 2020.
BUSINESS REPORT