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SA inflation accelerates to 6%

Johannesburg - South Africa’s inflation rate rose to 6 percent in March, the top of the central bank’s target.

Inflation accelerated from 5.9 percent in February, the Pretoria-based statistics office said.

The median estimate of 21 economists surveyed by Bloomberg was 5.9 percent.

Prices rose 1.3 percent in the month.

Inflation close to the upper end of the Reserve Bank’s 3 percent to 6 percent target band prompted policy makers to raise borrowing costs for the first time in more than five years in January.

While the rand has gained 5.3 percent against the dollar since then, allowing the bank to keep the benchmark interest rate at 5.5 percent last month, Governor Gill Marcus said on April 8 the “accommodative” policy stance can’t be maintained indefinitely.

Inflation will probably average 6.3 percent this year and peak at 6.6 percent in the fourth quarter, Marcus said on March 27.

The bank forecasts inflation will breach the upper end of its target band in the 12 months through the second quarter of 2015.

The core inflation rate, which excludes food, non-alcoholic beverages, fuel and energy, rose to 5.5 percent in March from 5.3 percent in the previous month. - Bloomberg News

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