Inflation cools to 2.7% thanks in part to cheaper fuel
South Africa’s annual consumer inflation eased to 2.7 % in March, down from 3.2 % the month before, marking the first decline in five months. The drop was driven by fuel costs, now 9 % lower than a year earlier. Despite rand volatility—sliding to nearly R19.90 before rebounding to R18.55—petrol and diesel prices are heading for modest cuts in early May.
Annual consumer inflation cooled to 2.7% in March, from 3.2% in February. This was the first inflation decline in five months, and was largely due to lower fuel prices, Statistics SA reported.
Average fuel prices are almost 9% cheaper than a year ago and, despite a sharp weakening in the rand, petrol and diesel prices are currently on track for small cuts in the first week of May. South African fuel prices are largely determined by international oil costs and the rand exchange rate, as oil is priced in dollars.
Amid trade war turmoil and fears about the DA leaving the government of national unity, the rand fell to almost R19.90 earlier this month. But it has since recovered to trade around R18.55 on Wednesday morning. Meanwhile, oil prices have been under pressure amid fears about global demand and too much supply in the market.
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Source : BDNews24.com
