Inflation outlook darkens as economists warn of more fuel-driven pressure, possible rate hike

StatsSA said the increase marked the biggest jump in inflation since August 2024, when headline inflation reached 4.4%, and moved further away from the Sarb’s 3% inflation target.

South Africa’s inflation outlook has deteriorated sharply after consumer inflation accelerated to 4% in April from 3.1% in March, intensifying expectations that the South African Reserve Bank (Sarb) could raise interest rates at next week’s Monetary Policy Committee (MPC) meeting.

According to data from Statistics South Africa (StatsSA), the increase marked the biggest jump in inflation since August 2024, when headline inflation reached 4.4%, and moved further away from the Sarb’s 3% inflation target.

StatsSA chief director of price statistics, Patrick Kelly, said the sharp rise was largely due to soaring fuel costs.

“The index for fuel rose by 18.2% from March, the steepest monthly increase since the current CPI series started in 2008," Kelly said.