South Africa’s annual inflation slowed more sharply than expected in July as lower fuel and food costs eased pressure on households, but renewed increases in global oil prices could make the relief short-lived.
Annual consumer inflation fell to 4.3% in July from 5% in June, according to data released by Statistics South Africa on Wednesday.
That was the first slowdown in five months and was below the 4.5% median forecast of economists surveyed by Reuters.
Prices still increased by 0.2% between June and July. The lower annual inflation rate therefore does not mean that the overall cost of living fell. It means consumer prices increased at a slower rate than they did a year earlier.
Lower fuel prices made the largest contribution to the monthly moderation. The fuel component of South Africa’s consumer price index fell by 7.8% between June and July.
