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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
SOUTH AFRICA
MNI (London)
- South African CPI accelerated 0.6pp to a rate of 6.5% y/y in May, following +5.9% y/y in April. This breaks above the SARB's target range of 3-6%, after testing the upper bound for the last six months. A more modest 0.4pp uptick was forecasted by consensus.
- This is the highest inflation since January 2017, when CPI reached 6.6% y/y.
- The key upwards drivers were food and non-alcoholic beverages (+7.6% y/y), housing and utilities (+4.9% y/y), transport (+15.7% y/y) and miscellaneous goods and services (+3.9% y/y).
- Taking weighting into account, transport and food accounted for over half of total inflation, with the transport category responsible for 2.1pp. Soaring fuel prices were a key contributor, accounting for 1.4pp of headline CPI alone.
- Food prices saw a 2.1% m/m increase in May, the largest month-on-month jump since the February 2016 drought.
- With fuel costs set to continue to soar, pressure is building on the SARB to hike again by 50bp at the July 21 meeting, with a 75bp hike not off the table.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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