The reading was significantly higher than market expectations and reflects the impact of rising oil prices during the month amid heightened tensions in the Middle East.
South Africa’s producer inflation accelerated sharply in May, reaching its highest level in more than a year as a surge in fuel prices filtered through the manufacturing sector, raising concerns about potential knock-on effects for consumers and businesses.
Statistics South Africa (Stats SA) reported on Thursday that final manufactured producer price inflation (PPI) jumped to 7.8% year-on-year in May from 4.8% in April. On a monthly basis, producer prices increased by 2.6%.
The reading was significantly higher than market expectations and reflects the impact of rising oil prices during the month amid heightened tensions in the Middle East.
Investec economist Lara Hodes said the outcome surprised on the upside. Hodes said the oil price shock saw fuel prices increase notably again in May, with the Brent crude oil price averaging over $100 (R1,647) per barrel during the month.
