CPI falls to 6%

Johannesburg - The Consumer Price Index (CPI) annual inflation rate for all urban areas decreased to 6% in September 2013, Statistics SA said on Wednesday.

"This rate was 0.4 of a percentage point lower than the corresponding annual rate of 6.4% in August," Stats SA said in a statement.

"On average, prices increased by 0.5% between August 2013 and September 2013."

The food and non-alcoholic beverages index increased by 0.8% between August and September while the annual rate decreased to 5.9% in September from 7.1%.

The housing and utilities index increased by 0.8%, due to a 1.2% increase in actual rentals for housing and owners' equivalent rent. The annual rate was unchanged at 5.4%.

The household contents and services index increased by 1.1%. The annual rates increased to 3.8% in September from 3% in August.

The transport index increased by 0.3% between August and September, while the annual rate decreased to 6.9% in September from 8.7% in August.

The recreation and culture index increased by 0.5% between August and September. The annual rate was unchanged at 3.6%.

Investec group economist Annabel Bishop said the CPI was in line with consensus because there was no petrol price hike in September.

"October saw a 20c/litre petrol price cut, which will lower the CPI inflation outcome in that month, so that it falls back within target," she said.

"A similar sized cut in the petrol price is being scheduled for November, which will assist in keeping CPI inflation within the 3% to 6% target band in the fourth quarter."

She said consumer inflation was at the high end of the target band and was driven by significant hikes including the petrol prices.

The rand should see further strength by March 2014 which could result in a further lowering of the petrol price and inflation, she said.