Consumer inflation moved further outside the Reserve Bank’s 3%-6% target range in December. The consumer price index (CPI) increased 6.8% in December compared with a year earlier, Statistics SA said on Wednesday, from November’s 6.6%. Trading Economic had forecast a 6.8% increase, and the Bloomberg consensus was for a 6.5% rise. The average inflation for 2016 was 6.4%, which is in line with the expectations of the Reserve Bank. The Bank’s outlook for CPI inflation is that it will come back within the 3%-6% target range in 2017 when it is seen slowing to 5.8%, and easing further to 5.5% in 2018. Nedbank said the inflation figures underscored the need for caution before calling the end of the Reserve Bank’s rate hiking cycle. “While our baseline view is that the next move by the Reserve Bank is probably down, we still expect the MPC [monetary policy committee] to remain cautious, leaving rates at current levels for some time, given the downside risks posed to the rand by a volatile do...
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