Consumer inflation slows in June
The annual change in the consumer price index (CPI) was 5,1% in June, down from 5,2% in May.
Inflation has remained within the 5% to 6% range for the past 10 months. The monthly rate was 0,1% in June.
Annual food inflation the lowest in 45 months
After stalling at 4,7% in April and May, the annual rate for food and non-alcoholic beverages (NAB) edged lower to 4,6% in June.
Food and NAB inflation has declined from its recent peak of 14,0% in March 2023. June’s reading is the lowest since September 2020 – 45 months ago at the peak of the COVID-19 lockdowns – when the rate was 3,8%.
Several food and NAB categories registered lower annual rates in June, including sugar, sweets and desserts; vegetables; fruit; milk, eggs and cheese; and fish. Inflation quickened, however, for hot beverages; bread and cereals; oils and fats; cold beverages; and meat.
The annual rate for hot beverages steamed to 16,5% in June from 14,2% in May.
The monthly change was 2,2%, driven by sharp price increases for drinking chocolate (up 3,5%), black tea (up 2,7%), instant coffee (up 2,2%) and rooibos tea (up 1,6%).
The annual rate for bread and cereals saw its first increase in 14 months, rising to 5,2% in June from 3,9% in May.
The monthly rate was 1,5%, with notable increases for maize products such as maize meal (up 3,3%) and samp (up 3,0%).
For some context, the producer price index (PPI) for final manufacturing, which measures prices at the factory gate, recorded a 7,2% monthly (4,6% annual) increase for maize products in May.
Maize in the agriculture PPI increased by an annual 23,8%. PPIs are often leading indicators of the CPI, so the data suggest that elevated inflation for maize-based products is widespread.
The milk, eggs and cheese category has experienced six months of slower inflation.
The rate for June was 7,3%, down from 14,5% in December 2023. Annual egg inflation recorded its seventh consecutive month of decline, cooling to 20,4%.
The graphs below show food and beverage products that recorded the most significant annual and monthly price increases in June.
Other notable price changes
Housing and utilities recorded an annual inflation rate of 5,5% in June, lower than 5,8% in May.
Housing rentals are surveyed quarterly. Actual rentals increased by 0,8% in the second quarter of 2024 compared with the first quarter.
Imputed rentals edged higher by 0,7% over the same period.
Townhouses recorded the highest quarterly change at 1,5% (actual rentals) and 1,2% (imputed rentals). Domestic worker wages registered a quarterly rise of 1,6%.
Annual transport inflation cooled to 5,5% in June from 6,3% in May. New vehicle inflation slowed to 5,2% from a recent high of 8,4% in September 2023. Data from naamsa indicates that there is lower demand for new passenger vehicles, with sales declining by 9,0% year-on-year in June.1
Inflation for used vehicles was 3,0%, down from 3,7% in May.
Fuel prices dropped by 4,6% between May and June, taking the annual rate for fuel to 7,6% from 9,3%.
BUSINESS REPORT