Inflation at pre-pandemic levels not a threat to low rates
Inflation accelerated at its fastest pace in more than a year but remains within the Reserve Bank’s 3%-6% target band
A faster-than-expected acceleration in consumer inflation in April, largely driven by base effects after prices fell a year earlier, won’t be enough to prompt the start of interest-rate increases by the Reserve Bank, according to economists.
Stats SA’s report on Wednesday came a day before the monetary policy committee (MPC) completes its latest meeting, with all 19 economists surveyed by Bloomberg expecting the repo rate to be kept at 3.5%, the lowest official rate in about five decades. Another report showed retail sales down 3.7% in March from February, the biggest slide since April 2020, when virtually the whole economy was closed due to Covid-19 restrictions...