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Johannesburg - The increase in South Africa's consumer price index excluding mortgage rate changes (CPIX) for metro and other areas, which is used by the South African Reserve Bank (SARB) for its inflation target, was up 13.6% year-on-year (y/y) in August from 13.0% y/y in July, Statistics South Africa (Stats SA) said on Tuesday.
CPIX was expected at 13.2%, an I-Net Bridge survey found, with
forecasts ranging from 12.9% to 13.8% and from just 6.3% a year ago.
Headline consumer prices - the 12-month rate of change in the consumer price index (CPI) for metropolitan areas - was up 13.7% y/y in August from a 13.4% y/y increase in July. Headline CPI was expected to have increased by a whopping 13.6% from just 6.7% a year ago.
Forecasts for CPI ranged from 13.2% to 14.1%.
The core inflation rate, which excludes volatile foods, municipal rates and monetary policy changes, was up 14.3% y/y in July from 13.7% y/y in July.
Economists have expressed concern over the data.
Nedbank economist Carmen Altenkirch said: "I must admit it's much higher than what the market had expected. It still
reflects rising food prices and electricity price increases from
municipalities.
"In the short term, we expect CPIX to ease due to base factors such as the decline in fuel prices and the new methodology from next year should help matters."
Mike Shüssler, economist T-Sec, said that a higher number was expected. "What the figures show us is that the inflation monster is not yet behind us. People who think this inflation number will fall like a stone are gravely mistaken.
"We have got to start realising that the inflation rate is not going to come down as quickly as we thought it would. The number will not be good for bonds, for the JSE and at the end of the day, the rand," he said.
Efficient Group economist Dawie Roodt said: "This is a bad one. It is worse than expected. I don't think the Reserve Bank will change anything yet, it doesn't mean there will be another rate increase.
"The figures show that there are still inflationary pressures in the market and these are strong."
- I-Net Bridge