Farm and factory gate inflation slows slightly
The farm prices of fruit and vegetables fell, but cereals got more expensive, according to November’s producer price index
Falling fruit and vegetable prices helped slow producer inflation in November. Farm and factory gate inflation, as measured by the annual change in the producer price index (PPI), slowed to 6.8% in November from 6.9% in October, Statistics SA reported on Thursday. The slight slowdown matched economists’ consensus.
According to Stats SA, the average wholesale price of fruit and vegetables was 2.1% lower in November than the same month in 2017. The wholesale price of meat fell 0.9% over the year, and sugar prices fell 4.6%. But cereals getting 8.6% more expensive, and bakery products 5.9%, brought the overall food component of producer inflation to 2.3%. Fuel was the main driver of rising producer inflation, with diesel prices showing an annual increase of 30.2% and petrol 23.7%. “Producer inflation is expected to ease further and dip below 6% in the short term, mainly as a result of lower fuel costs. Upside risks to the inflation outlook are likely to emanate from the high risk...
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