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Inflation moderates to 5.3%

Economy

Johannesburg – Headline inflation – the Consumer Price Index – has moderated to 5.3 percent.

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A shopper carries a basket in a supermarket.

This is a decline from the 6.1 percent recorded by Statistics South Africa in March.

On Wednesday, the official stats agency said the rate was 0.8 percentage points lower than the March figure.

South African consumers have been battling rising food and energy prices. Inflation has been staying outside the 3-6 percent target band set by the South African Reserve Bank.

The bank is due to announce whether it will raise interest rates on Thursday. The prime lending rate is currently 10.25 percent.

Consensus is that, as the inflation figure is moderating, the bank will hold rates steady, although it is too early for it to start decreasing the cost of borrowing.

Stats SA notes, on average, prices increased by 0.1 percent between March 2017 and April 2017.

Read also: How South Africans are dealing with inflation

Several items, such as food and beverages and transport, were less costly in April than in March, Stats SA’s research shows.

Food inflation has been a bug bear for consumers with retailers doing their best to keep prices down following last year’s prolonged drought, the worst in recorded history.

BUSINESS REPORT ONLINE

For more on this, pick up a copy of Business Report tomorrow.

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