The annual change in the consumer price index (CPI) in August was 4,9%. This was slightly higher than July’s increase of 4,6% and identical to the reading in June. This is the fourth consecutive month where the annual increase is higher than the midpoint (4,5%) of the South African Reserve Bank’s monetary policy target range.
The change in the CPI between July 2021 and August 2021 was 0,4%.
Transport inflation accelerates on the back of vehicle and fuel prices
Transport was the most significant contributor to both the annual and monthly CPI readings in August, increasing by 9,9% annually and 2,2% monthly. Vehicle prices increased at a rate higher than overall inflation across all 16 months from May 2020 to August 2021. In contrast, vehicle inflation mostly lagged overall inflation during 2018 and 2019.
Petrol prices recorded all-time highs in August 2021, with the price of inland 95-octane petrol, for example, reaching R18,30 per litre.1 Fuel prices increased by 4,9% between July and August and by 19,6% over the last 12 months.
Public transport fares registered an increase of 1,5% between July and August, underpinned by a rise in airfares (up 21,6%). The annual increase for public transport was 5,3%.
Monthly food inflation remains unchanged for a third month
The food & NAB (non-alcoholic beverages) product group was the second largest contributor to the annual inflation rate in August, recording an increase of 6,9%. This is the highest level of food inflation since June 2017 when it was also 6,9%.
However, there are signs that food inflation may have begun to slow. The monthly increase in August 2021 was 0,2% – identical to the readings for both July and June. By comparison, the average monthly increase over the past 12 months was 0,6%. Of the 11 food/NAB categories, four registered monthly decreases in August, one showed no change, and 6 recorded increases.
Prices for bread and cereal products declined by 0,5% from July 2021. Maize meal prices decreased by 1,2% and white bread by 1,1%. The annual increase for this category was 3,5%.
Meat inflation continues to accelerate, reaching 10,7% in August. This is the highest level since February 2018 when the rate was 11,4%. IQF (individually quick frozen) chicken products were 1,6% more expensive in August compared with July, while minced beef was 0,4% cheaper.
Annual inflation for oils & fats registered at 21,3% in August, slightly down from 22,4% in July. The index did not change between July and August. Cooking oil prices dipped by 0,4% and margarine by 0,8% month-on-month.
For more information, download the August 2021 Consumer Price Index (CPI) release here.
1 Department of Mineral Resources and Energy. Comparing prices for petrol, diesel and illuminating paraffin (IP) (click here).
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