South Africans could face rising living and borrowing costs after inflation accelerated to 4% in April, with economists warning that fuel-driven global price shocks — not domestic demand — are complicating the South African Reserve Bank’s interest rate outlook
South Africans could face rising living and borrowing costs after inflation accelerated sharply in April, raising questions over whether interest rate hikes can curb price pressures increasingly driven by global fuel shocks rather than domestic demand.
Consumer inflation rose to 4% in April from 3.1% in March, according to figures released by Statistics South Africa on Wednesday.
The increase returns headline inflation to the midpoint of the South African Reserve Bank’s target range of 3% to 6% after several months of softer inflation readings.
Although inflation remains within the Reserve Bank’s formal target range, economists say the speed of the increase and the geopolitical pressures behind it are likely to raise concern about the outlook for interest rates.
