KEEP UP TO DATE WITH ALL THE IMPORTANT COVID-19 INFORMATIONCOVID-19 RESOURCE PORTAL

FANews
FANews
RELATED CATEGORIES
Category Economy
SUB CATEGORIES General |  Budget 2017 |  Budget 2018 |  Budget 2019 |  Budget 2020 |  Budget 2021 | 

CPI for April 2021

19 May 2021 Luigi Marinus, PPS Investments Portfolio Manager

Consumer price inflation increased by 4.4% year-on-year as at the end of April 2021, which was greater than the 3.2% year-on-year increase from the previous month. After hovering around the bottom of the target band for a year, inflation increased sharply to close to the midpoint of the band.

This was widely expected as a result of the base effect and the recent increase to certain sectors of the inflation basket. Month-on-month inflation increased by 0.7% in April 2021, equivalent to the monthly increase over the two previous months.

This increase in inflation appears to have justified the South African Reserve Bank’s choice to not further reduce short term interest rates in their most recent meetings, even though inflation was low. Their forecast that inflation will increase to around the mid-point of the target band and the subsequent realisation of this, is likely to signal the end of the cutting cycle although rate hikes, at this stage, are only expected to start towards the end of the year.

Quick Polls

QUESTION

Healthcare brokers have long complained about inflation-plus medical scheme contribution increases; but pandemic may have changed things. What will pandemic-induced changes in hospital utilisation do to medical scheme contribution increase patterns?

ANSWER

Below inflation increase for 2022, then back to inflation-plus
Long-term trend of below inflation increases
Inflation-linked hikes for 2022, then back to inflation-plus
This is a 2-year hiccup, inflation-plus increase trend remains in place
fanews magazine
FAnews June 2021 Get the latest issue of FAnews

This month's headlines

Broker and insurer collaboration should not be a one-way street
Running on outdated systems… There's risks
Policy wordings with respect to COVID-19
Death or divorce... how best to split assets
Ethical investing… principles and moral codes
Portfolio positioning will serve investors well
Subscribe now