Inflation expected to remain steady: Analysts

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Analysts expect inflation to remain unchanged when Statistics South Africa releases the May consumer price index figures at 10 o’clock tomorrow morning.

Inflation cooled marginally to reach 5.2 percent in April 2024 with the decline largely driven by reduced food prices.

While inflation continues to decline, it remains above the Reserve Bank’s 4.5 percent midpoint target which the bank views as the ideal level to start cutting interest rates.

Senior Analyst at ETM Analytics Laura Campbell explains.

“It’s likely that we’ll see a downward trend in food inflation, so overall we’re expecting May’s inflation point to remain steady. A slowdown in services inflation particularly insurance and medical aid will also help. If we continue to see prints reflecting stable inflation, this will reinforce our expectation of a possible rate cut by the SARB in November this year.”