The cost of goods leaving South African factories rose at a slower pace in February from a year ago, the statistics office said.
Producer-price inflation for final manufactured goods slowed to 5.4 percent from 5.8 percent in January, Pretoria- based Statistics South Africa said on its website today. The median estimate in a Bloomberg survey of 10 economists was 5.6 percent. Prices rose 0.6 percent in the month.
The Reserve Bank last week held the benchmark repurchase rate at 5 percent, the lowest level in more than 30 years, as inflation pressures and a weaker rand prevented it from stimulating the economy. The rand has dropped 8.9 percent this year against the dollar, the worst performer among the 16 major currencies tracked by Bloomberg, boosting import costs.
Reserve Bank Governor Gill Marcus has said that the rand and rising food and fuel prices are the biggest threat to inflation. Consumer-price inflation quickened to 5.9 percent in February, near the top of the bank’s target of 3 percent to 6 percent.
South Africa reduced the number of items in the basket used to calculate PPI to 273 from 800 and now publishes separate indexes for agriculture, mining, electricity and intermediate manufactured goods starting in January. The steps were taken to bring the index in line with international standards, the agency said.
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