Stats SA to release CPI figures today

Wednesday, February 24, 2010

Pretoria - Statistics South Africa (Stats) will today release figures for January's Consumer Price Index with economists expecting the CPI to remain above the inflation target.

In December, CPI, which is used to measure inflation, came in at 6.3 percent.

"We expect it to stay above 6 percent with the contributors still being base effects from last year and the strength of the Rand," said Investment Solutions senior economist Chris Hart.

Standard Bank is forecasting inflation to come in at 6.4 percent.

"It will increase marginally higher due to technical base effects but it should return to the target by March," said Standard Bank economist Danelee van Dyk, adding that food inflation played a key role in keeping inflation low and that it is likely to continue doing so for the rest of the year.

Commenting on the Reserve Bank's Monetary Policy Committee (MPC) next month, van Dyk said GDP figures, released yesterday, will have no bearing on the central Bank's decision regarding rates unless the economy performs badly.

"It will have no bearing on the MPC other than confirm that the economy is turning around. Economic growth will have to disappoint for the bank to cut rates further," she said.

Standard Bank expects the central bank to cut rates again by 50 basis points only in November.

South Africa's economy in the fourth quarter of 2009 grew by 3.2 percent.