Consumer price inflation curbed by education and housing, but it will soon breach 5% due to higher fuel and administered prices

Herman van Papendorp, Head of Investment Research & Asset Allocation at Momentum Investments

Johann van Tonder, Economist at Momentum

Highlights

• March’s year-on-year (y/y) headline consumer price inflation (CPI) rate increased to 3,2% from 2,9% in February.
• Month-on-month (m/m) CPI rose by 0,7% in March, the same as in February.
• Fuel, food, housing and education inflation influenced CPI in March 2020.
• Core CPI increased by 2,5% y/y (2,6% in February), while it rose 0,5% m/m compared to 0,6% in February.
• Headline CPI is expected to breach 5% in the next quarter on the back of higher fuel and administered prices.
• However, as the average headline CPI for 2022 and 2023 is expected around the 4,5% mark targeted by the Monetary Policy Committee (MPC), the repo rate is expected to remain unchanged this year.

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