South Africa experienced a smaller-than-anticipated increase in its inflation rate for November, remaining slightly below the central bank’s target range, primarily due to a decline in food inflation, which reached its lowest point in nearly 14 years.
The headline consumer inflation rate recorded a year-on-year figure of 2.9% in November, up from 2.8% in October. On a month-to-month basis, inflation stood at 0.0% in November, in contrast to -0.1% in October, according to data from Statistics South Africa.
The central bank reduced its primary lending rate by 25 basis points (bps) last month, marking the second consecutive meeting in which this action was taken, following a decline in inflation that fell below the target range in October for the first time in several years.
In November, the inflation rate for food and non-alcoholic beverages decreased to 2.3% year on year, down from 3.6% the previous month. This marks the lowest rate of price increases for this category since December 2010, according to the statistics agency.
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A month-on-month rise in fuel prices contributed to an increase in the November headline inflation rate on a year-over-year basis. Meanwhile, annual core inflation, which omits food and fuel costs, was reported at 3.7% in November, falling short of expectations and down from 3.9% the previous month.
