JOHANNESBURG (Reuters) -South Africa’s headline consumer inflation quickened to 7.6% year-on-year in October, from 7.5% in September, data from Statistics South Africa showed on Wednesday.
The rise comes after South Africa’s headline consumer inflation slowed for the second consecutive month in September, leading many analysts and economists to believe that inflation had peaked.
The surprise uptick in inflation is likely to give impetus to the South African Reserve Bank’s hawkish stance. A Reuters poll forecast last week that the central bank would hike its repo rate another 75 basis points to 7% at its final meeting of the year on Thursday.
Higher food prices were the biggest contributor to headline inflation, rising to 12% in October from 11.9% in September.
Core inflation, which excludes prices of food, non-alcoholic beverages, fuel and energy, also rose to 5.0% year-on-year in October, from 4.7% previously.
On a month-on-month basis core inflation was at 0.5% in October, the same as the previous month.
In early November, the central bank governor said South Africa needed to get inflation expectations more anchored around the midpoint of its 3%-6% target range.
The bank has raised rates at the last six monetary policy meetings since its latest tightening cycle began in November 2021.
“Unlike other emerging markets, we don’t expect the tightening cycle to end soon,” Africa economist at Capital Economics Virag Foriza said in a research note.
(Reporting by Anait Miridzhanian and Kopano Gumbi; Editing by Promit Mukherjee, James Macharia Chege and Alex Richardson)
