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Inflation seen to fluctuate substantially

February 5 2013 at 08:00am

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Forecasts on inflation figures due later this month are likely to vary substantially, according to Citi analyst Gina Schoeman.

Statistics SA yesterday released final figures for its reweighting of the consumer price basket: a transition which took place last month.

Schoeman predicted the new weighting would add 0.3 percentage points to inflation through the year.

She noted a higher weight for administered pricing, 18.5 percent versus 14.7 percent previously; and medical aid insurance 7.9 percent from 3.7 percent.

This would add “further upside price pressure, particularly for February when the annual medical aid price survey takes place”.

She put last month’s inflation rate at 5.6 percent and predicted that, by the second quarter, inflation would breach the ceiling of the Reserve Bank’s 3 percent to 6 percent target range, and would average 6 percent for the year. – Ethel Hazelhurst


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