South Africa’s inflation accelerated to 5 percent, keeping pressure on the central bank to maintain its gradual path of monetary policy tightening.
The inflation rate rose from 4.7 percent in June, the Pretoria-based statistics office said on its website on Wednesday. The median estimate of 25 economists surveyed by Bloomberg was 5 percent. Prices gained 1 percent in the month.
The central bank raised its benchmark repurchase rate in July for the first time in a year as it forecast inflation will exceed the 3 percent to 6 percent target band for the first half of next year. The current interest-rate tightening cycle will be “moderate,” Governor Lesetja Kganyago said on Aug. 11.
While the central bank cites the rand’s slump as the main risk to the inflation outlook, the pass-through effects to prices from the weakening currency may be easing. The rand has dropped 10 percent against the dollar this year.
Core inflation, which excludes food, non-alcoholic beverages, gasoline and electricity costs, slowed to 5.4 percent in July from 5.5 percent in the previous month.