Consumer inflation softened to 5.3% in March from 5.6% in February as food inflation fell to a three-and-a-half-year low, following a two-month upswing in consumer prices.
This means that the rate of headline inflation has held its ground between 5% and 6%, below the upper limit of the SA Reserve Bank’s target range, since September 2023.
Statistics South Africa (Stats SA) said inflation for food and non-alcoholic beverages (NAB) slowed to 5.1% in March, down from 6.1% in February.
Stats SA’s director for price statistics Patrick Kelly said this was down from its recent peak of 14.0% in March 2023, and is the lowest annual increase since September 2020 when the rate was 3.8%.
“Bread and cereals registered a softer annual print of 5.0% from February’s 6.1%. The rate is substantially lower than the recent high of 21.8% in January 2023,” Kelly said.
“Bread flour, pasta, rusks, maize meal, ready-mix flour and white bread are cheaper than a year ago. Meat inflation also cooled in March on the back of lower beef and mutton prices. The annual rate for meat in March was 0.8%, significantly lower than the recent peak of 11.4% in February 2023.”
However, Kelly said the annual inflation for sugar, sweets and desserts has remained above the 15.0% level since June 2023, as it was 17.8% in March.
He said products with the most significant annual price increases included brown sugar, white sugar, chocolate slabs, and chocolate bars.
On a monthly basis, inflation rose by 0.8% in March, after a 1% increase in February.
The categories with the highest annual price changes in March were miscellaneous goods and services, education, health, and housing and utilities.
Overall, education was 6.3% more expensive in 2024 than it was in 2023.
This exceeds the 5.7% annual increase in 2023 and is the highest since 2020 when the rate was 6.4%.
High schools recorded the most significant increase in 2024, rising up to 7.3%, followed by primary schools and tertiary institutions.
Crèches increased their fees by 6.0% whilst university boarding was on average 8.2% more expensive than a year ago.
The increase in miscellaneous goods and services was mainly driven by higher health insurance premiums, recorded by Stats SA in February, with the average price of health insurance increasing by 12.9% in 2024.
Other notable price changes in March included inflation for alcohol and tobacco, which was fuelled by annual increases in excise taxes.
The index increased by a monthly 1.9% in March, the highest monthly rise since March last year when excise tax increases led to a 2.2% monthly rise.
Prices for alcohol and tobacco increased by 4.5% overall in the 12 months to March.
Transportation prices rose by 2.0% between February and March, mainly due to a monthly rise of 5.3% in fuel prices.
BUSINESS REPORT