South African Inflation Rate Climbs to 18 Month-High in November

(Bloomberg) -- South Africa’s inflation rate jumped to the highest level since May last year as surging transport costs continue to weigh on the economy.

Consumer prices rose 5.2 percent from a year earlier compared with 5.1 percent in October, Pretoria-based Statistics South Africa said in a statement Wednesday. The median estimate of 17 economists surveyed by Bloomberg was for 5.1 percent.

Key Insights:

• The unexpected acceleration in inflation may ease criticism of the central bank’s decision to raise interest rates last month as the headline number moves further away from the mid-point of its target range.
• Fuel prices had jumped 19 percent over the past 12 months after the rand weakened against the dollar, offsetting a decline in crude costs.
• The Reserve Bank will decide again on rates on Jan. 17, with forward-rate agreements seeing a small chance of a 25 basis-point hike.

To contact the reporter on this story: Gordon Bell in Johannesburg at gbell16@bloomberg.net

To contact the editor responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net

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