Factory gate prices climb higher
Johannesburg - Statistics South Africa said on Thursday producer inflation, which represents domestic output, quickened to 9.6% year-on-year (y/y) in August from 8.9% in July, and was at 1.0% month-on-month (m/m) from 2.7%.
The market was expecting producer price inflation (PPI) to quicken slightly to 9.0% y/y and brake to 0.5% m/m.
analyst George Glynos said the figure did not change its view on interest
believe inflation is a monetary phenomenon. But, in so far as this data
highlights cost-push pressures, I would say it gives good justification as to
why GDP (gross domestic product) growth expectations need to be revised down with cost-push pressures
eating into disposable income of households.”
consumer price index was flat at 5.3% y/y in August compared with
July, but its link with PPI, which is dominated by commodities, has been
rise in global commodity prices and seasonal electricity tariff increases
weigh on producer prices.
central bank has left its repo rate unchanged at 5.5% at five policy meetings
so far this year, after reducing it by 650 basis points in the two years to
Wage increases , municipal increases, Eskom increases, manipulation of the Rand increases -- it has to go somewhere -- into the consumers pocket.