Producer inflation jumps to 4.4% in April
Diesel’s contribution to PPI showed 10.6% annual inflation in April, and a 5% jump from March’s diesel prices
Factory and farm gate inflation, as measured by the annual change in the producer price index (PPI), accelerated to 4.4% in April from 3.7% in March.Producer inflation was expected to accelerate in April when a range of higher taxes and levies introduced in the government’s 2018 budget took effect.The 4.4% reported by Statistics SA on Thursday, however, was higher than the economists’ consensus of 4.2%.Higher oil prices and taxes resulted in the government-set wholesale price of Gauteng diesel rising 69c/l and retail price of 95 octane petrol rising 72c/l in April.This translated into diesel’s contribution to PPI showing 10.6% annual inflation in April, and a 5% jump from March’s diesel prices.The petrol component of PPI showed 8.9% annual inflation, and 5.4% inflation from the prior month.The one percentage point rise in value added tax (VAT), taking it to 15%, appears to have been mitigated by better rain for farmers outside of the Western Cape.The price of sugar for food manufact...
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