Inflation expectations rise before South Africa rate decision
South Africa’s two-year inflation expectations climbed,complicating the central bank’s efforts to anchor expectations around its 3% target.
Average inflation expectations two years ahead, the measure the central bank closely watches when setting interest rates, rose to 3.9% in the second quarter from 3.6% previously, according to a survey published by the Stellenbosch-based Bureau for Economic Research on Tuesday.
The survey was conducted between May 18 and June 4, before the US-Iran 60-day ceasefire deal reopened the Strait of Hormuz, sending global energy costs lower and triggering a decline in local fuel prices, which should see inflation ease in coming months.
Between survey rounds, annual inflation accelerated to 4.5% from 3% and gasoline prices hit a record.
South African Reserve Bank Governor Lesetja Kganyago recently warned that policymakers would need to act on rising inflation expectations to prevent the impact of the oil shock from fanning broader price pressures.
“We now have inflation expectations, and expectations have drifted away from target,” he told broadcaster CNBC Africa. “And what we have seen is that all price setters are expecting inflation higher, and that is what the central bank has got to act on, reining in those expectations.”
Policymakers, who raised interest rates by 25 basis points to 7% at their last meeting, will deliver their next policy decision on July 23.
Article Enquiry
Email Article
Save Article
Feedback
To advertise email advertising@creamermedia.co.za or click here
Projects
Latest Multimedia
Latest News
Showroom
Sweet-Orr, established in 1871, is a global leader in superior protective workwear, known for quality, innovation, and performance.
VISIT SHOWROOM
Established in 1933, EKATO is the world leader in agitation technology, supplying agitators for processes and applications such as chemicals and...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
