PPI accelerated slightly to 5.2% in December, in line with forecasts
Farm and factory gate inflation, as measured by the annual change in the producer price index (PPI), accelerated slightly to 5.2% in December from 5.1% in November. The PPI averaged 4.8% in 2017, down sharply from 7% in 2016. The rise was similar to December’s consumer price index (CPI), which accelerated to 4.7% from 4.6% in November. The food component of PPI decelerated to 1% from November’s 1.9%, with wholesale meat prices moderating to 12.6% in December from the same month in 2016. In November, meat inflation was 13.5%, Statistics SA reported on Thursday. Electricity prices dropped to 2.1% from 3% while water price inflation remained at 10.5%. FNB chief economist Mamello Matikinca projected that the December PPI would moderate back toward the 5% year-on-year level, after which it is set to track sideways to slightly higher for most of 2018. Investec economist Kamilla Kaplan said she expected PPI to have lifted to 5.2%. “In line with CPI, the slightly higher rate of inflation wo...
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