Latest news with #PatrickKelly
IOL News
43 minutes ago
- Business
- IOL News
Sarb poised for rates cut despite inflation tickin up to 4-month high
Stats SA chief director of price statistics, Patrick Kelly, said the annual rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. Image: Simphiwe Mbokazi/Independent Newspapers The South African Reserve Bank (Sarb) may once again loosen its monetary policy before the year draws to a close despite recent data revealing an uptick in consumer price inflation. This comes as the Sarb's Monetary Policy Committee (MPC) will announce its decision on the policy rate next week after cutting the repo rate by 25 basis points to 7.25% per annum in May. Data from Statistics South Africa (Stats SA) on Wednesday showed that the headline consumer price index (CPI) edged higher to 3.0% in June after holding steady at 2.8% in April and May. This was the 11th consecutive month in which inflation remained below the 4.5% midpoint of the Sarb's 3-6% target range. Stats SA chief director of price statistics, Patrick Kelly, said the annual rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. The price of beef significantly rose on the back of the food and mouth disease outbreak in meat producing provinces, reducing the supply of red meat more than the demand in the market. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading "Meat – particularly beef – continues to be the main driver of food inflation," Kelly said. "Beef prices spiked for a third successive month, with high annual and monthly increases recorded for stewing beef, mince and steak. Stewing beef rose by an annual 21.2%, the fastest pace on record since the current CPI series began in January 2017." Analysts are closely watching the Sarb's next moves as they navigate the complexities of a fluctuating economic landscape. Dr Elna Moolman, Standard Bank Group head of South Africa Macroeconomic Research, said consumer inflation re-entered the Sarb's target range again in June after falling below the 3-6% target range for three consecutive months. 'Such low inflation provides considerable support for consumers, given that most wage increases are higher than this low prevailing rate of inflation. It also arguably supports the case for the Reserve Bank to cut interest rates further at the upcoming MPC meeting next week,'Moolman said. 'We do expect inflation to continue trending higher in the coming months, but it should remain reasonably benign.' On a monthly basis, the CPI increased 0.3% following a 0.2% rise in May. Meanwhile, the annual core inflation rate edged down to 2.9% in June, the lowest since April 2021, from 3% in each of the previous two months. David Omojomolo, Africa economist at Capital Economics, noted that the slowdown in core inflation has set a favourable backdrop for potential interest rate cuts, reinforcing the Sarb's stance against excessive underlying price pressures. Omojomolo projects considerable relief for consumers, forecasting further cuts by year-end 'We expect rates to be lowered by more than most currently anticipate by the end of next year. The outturn was a touch stronger than our forecast that inflation would stay unchanged at 2.9% year-on-year, but in line with the LSEG consensus,' Omojomolo said. 'We expect a 25 basis points cut to 7.00% at the MPC meeting next week. And we think the Sarb will cut interest rates by another 125 basis points to 5.75% by end-26, further than most expect – even if the inflation target is lowered.' In a recent statement, Sarb Governor Lesetja Kganyago hinted at a potential shift in the bank's inflation target, considering a lower objective of 3% in light of internal and external analyses indicating that its current target may be unusually high. Nedbank economist Busisiwe Nkonki fforesees ongoing upward pressure on inflation during the second half of the year, primarily driven by food and fuel costs. The ongoing foot-and-mouth disease outbreak is expected to result in soaring meat prices, compounded by unpredictable geopolitical developments impacting the global price of Brent crude oil. 'We believe that the benign inflation outlook and muted domestic demand, amongst other factors, will convince the MPC to cut interest rates by 25 basis points next week,'she said. 'However, the MPC's decision will also be influenced by the US Fed's decision in the same week. Therefore, there is a chance that the MPC could delay the cut to September.' BUSINESS REPORT
The Herald
7 hours ago
- Business
- The Herald
Food inflation, notably price of beef, leads in pushing CPI upward: Stats SA
Stats SA announced on Wednesday that annual consumer price inflation was 3.0% in June, up from 2.8% in May. The consumer price index (CPI) showed an increase by 0.3% month-on-month in June, with food inflation experiencing specially pronounced rises. Patrick Kelly, chief director of price statistics at Stats SA, said among other categories of inflation, the annual inflation rate for food and non-alcoholic beverages recorded its highest levels in more than a year. 'After holding steady at 2.8% in April and May, consumer inflation edged higher to 3% in June. The month-on-month change in the CPI was 0.3%. The annual rate for food and non-alcoholic beverages reached a 15-month high of 5.1% in June. 'Meat, particularly beef, continues to be the main driver of food inflation. Beef prices spiked for a third successive month, with high annual and monthly increases recorded for stewing beef, mince and steak.' Conversely, Kelly said, fuel prices continued a downward trajectory and declined for a fourth consecutive month.
TimesLIVE
8 hours ago
- Business
- TimesLIVE
Food inflation, notably price of beef, leads in pushing CPI upward: Stats SA
Stats SA announced on Wednesday that annual consumer price inflation was 3.0% in June, up from 2.8% in May. The consumer price index (CPI) showed an increase by 0.3% month-on-month in June, with food inflation experiencing specially pronounced rises. Patrick Kelly, chief director of price statistics at Stats SA, said among other categories of inflation, the annual inflation rate for food and non-alcoholic beverages recorded its highest levels in more than a year. 'After holding steady at 2.8% in April and May, consumer inflation edged higher to 3% in June. The month-on-month change in the CPI was 0.3%. The annual rate for food and non-alcoholic beverages reached a 15-month high of 5.1% in June. 'Meat, particularly beef, continues to be the main driver of food inflation. Beef prices spiked for a third successive month, with high annual and monthly increases recorded for stewing beef, mince and steak.' Conversely, Kelly said, fuel prices continued a downward trajectory and declined for a fourth consecutive month.
IOL News
11 hours ago
- Business
- IOL News
Consumer inflation rises to 4-month high as beef prices drive food price surge
Stats SA chief director of price statistics, Patrick Kelly, said the year-on-year rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. The consumer price inflation in South Africa has edged upwards, reaching 3% in June after holding steady at 2.8% for the previous two months. This increase in inflation, the highest in four months, indicates a growing pressure on household budgets, particularly due to escalating costs in the food and non-alcoholic beverages sector. Statistics South Africa (Stats SA) said the consumer price index (CPI) revealed a month-on-month change of 0.3% in June, suggesting that while inflation remains relatively low, it is inching higher due to sharp increases in certain food categories. Stats SA chief director of price statistics, Patrick Kelly, said the year-on-year rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. "Meat – particularly beef – continues to be the main driver of food inflation," Kelly said. "Beef prices spiked for a third successive month, with high annual and monthly increases recorded for stewing beef, mince and steak. Stewing beef rose by an annual 21.2%, the fastest pace on record since the current CPI series began in January 2017." However, it was not just beef that has contributed to the rising food inflation. Other unprocessed food items have also shown significant price increases, with fruits and nuts, as well as vegetables, remaining in double-digit inflation territory for the second month in a row. Items such as beetroot, lettuce, and carrots have been particularly hard-hit, further straining the average consumer's wallet. Contrarily, peanuts have shown a slight reduction in price. In a somewhat positive turn, Stats SA said there have been signs of cooling inflation in several other food categories. Notably, prices for white rice, hot cereals, and cold cereals have decreased, which has softened the annual rate for the cereal products category. Though maize meal continues to see high annual increases, its month-on-month change in June was a modest 0.4%, the lowest increase since November 2024. Some dairy products have also experienced price reductions compared to last year. Fresh full-cream milk, fresh low-fat milk, and eggs have all recorded lower prices, resulting in the milk, other dairy products, and eggs index shifting into deflationary territory with an annual change of -0.5%. Despite this annual decline, the monthly rise of 0.3%—the highest since August 2024—shows that consumers are still facing fluctuating prices, particularly in cheese products which have contributed significantly to this increase. As consumers grapple with these rising food prices, the overall increase in the inflation may serve as a warning of potential challenges ahead for the South African economy. BUSINESS REPORT
IOL News
11 hours ago
- Business
- IOL News
Consumer inflation rises to 3% as beef prices drive food price surge
Stats SA chief director of price statistics, Patrick Kelly, said the year-on-year rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. The consumer price inflation in South Africa has edged upwards, reaching 3% in June after holding steady at 2.8% for the previous two months. This increase in inflation indicates a growing pressure on household budgets, particularly due to escalating costs in the food and non-alcoholic beverages sector. Statistics South Africa (Stats SA) said the consumer price index (CPI) revealed a month-on-month change of 0.3% in June, suggesting that while inflation remains relatively low, it is inching higher due to sharp increases in certain food categories. Stats SA chief director of price statistics, Patrick Kelly, said the year-on-year rate for food and non-alcoholic beverages has notably surged to a 15-month high of 5.1%, with meat prices—especially beef—being the primary culprit behind this uptick. "Meat – particularly beef – continues to be the main driver of food inflation," Kelly said. "Beef prices spiked for a third successive month, with high annual and monthly increases recorded for stewing beef, mince and steak. Stewing beef rose by an annual 21.2%, the fastest pace on record since the current CPI series began in January 2017." However, it was not just beef that has contributed to the rising food inflation. Other unprocessed food items have also shown significant price increases, with fruits and nuts, as well as vegetables, remaining in double-digit inflation territory for the second month in a row. Items such as beetroot, lettuce, and carrots have been particularly hard-hit, further straining the average consumer's wallet. Contrarily, peanuts have shown a slight reduction in price. In a somewhat positive turn, Stats SA said there have been signs of cooling inflation in several other food categories. Notably, prices for white rice, hot cereals, and cold cereals have decreased, which has softened the annual rate for the cereal products category. Though maize meal continues to see high annual increases, its month-on-month change in June was a modest 0.4%, the lowest increase since November 2024. Some dairy products have also experienced price reductions compared to last year. Fresh full-cream milk, fresh low-fat milk, and eggs have all recorded lower prices, resulting in the milk, other dairy products, and eggs index shifting into deflationary territory with an annual change of -0.5%. Despite this annual decline, the monthly rise of 0.3%—the highest since August 2024—shows that consumers are still facing fluctuating prices, particularly in cheese products which have contributed significantly to this increase. As consumers grapple with these rising food prices, the overall increase in the inflation may serve as a warning of potential challenges ahead for the South African economy. BUSINESS REPORT
