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The highest inflation rate in 10 months will not be enough for the Reserve Bank to consider raising interest rates any time soon, as a sluggish economy constrains the ability of businesses to pass on extra costs to customers and fuel future price increases. That will come as a relief for consumers who have been hit by a slowing economy, record petrol prices and the first VAT increase in a quarter of a century. Higher fuel prices were the main driver for acceleration in consumer inflation in July to an annual rate of 5.1%, the highest since September 2017, and up from 4.6% the previous month, according to figures released by Statistics SA on Wednesday. The rate is still comfortably within the Bank’s 3%-6% target range. Governor Lesetja Kganyago and his deputy, Daniel Mminele, said recently the Bank’s monetary policy committee (MPC) would not be swayed by short-term swings in the rand.

With an economy that may still swing into recession in 2018, and an unemployment rate near 30%...

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