South Africa's inflation has surged to 5% in June, surpassing forecasts and intensifying speculation about a potential interest rate hike by the Sarb, as economists and property leaders weigh in on the implications for economic growth and housing affordability.
South Africa's annual consumer inflation accelerated to 5% in June, exceeding economists' expectations and reinforcing expectations that the South African Reserve Bank (Sarb) could raise interest rates by another 25 basis points at its Monetary Policy Committee (MPC) meeting on Thursday.
The latest inflation reading increased from 4.5% in May and came in above market expectations of 4.7%, as higher fuel prices, transport costs and persistent services inflation continued to place pressure on consumers.
FNB economist Ame Muller said the June data surprised on the upside.
"Headline inflation rose to 5.0% year on year in June from 4.5% in May, exceeding our forecast of 4.8% and market consensus of 4.7%. Monthly pressure was 0.7% month on month, mainly driven by core inflation."
