Petrol price drop to allow Reserve Bank to leave interest rates unchanged for extended period
ALTHOUGH September’s 18c/litre petrol price decrease will reduce the monthly consumer inflation rate by a very modest 0.1 percentage points, this will still help to ease inflationary pressure and allow the Reserve Bank to leave interest rates unchanged for an extended period, according to Stanlib chief economist Kevin Lings.The petrol price will drop by 18c/litre on Wednesday after a sharp 99c/litre decline in August. Diesel will cost 48c/litre less while the paraffin price will decline by 63c/litre, and gas by 9c/kg.Since the peak in April 2014, the petrol price had now declined by total of R2.22/litre or by 15.4%. "Unfortunately, other cost pressures are still likely to push consumer inflation over 7% in late 2016, but at least the upcoming spike in inflation appears likely to be much more modest than what was envisaged in early 2016," Lings said.Lings warned, however, that the petrol price could increase in coming months as the rand is keeping a weakening bias."Worrying, the rand...
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