South African Inflation Slows for Second Month in November

  • Food prices rise at slowest pace in two years, agency says
  • Price growth has been in target range for eight months

Shoppers browse at a gold exchange store in Johannesburg, South Africa.

Photographer: Nadine Hutton

South Africa’s inflation rate fell for a second straight month in November as food prices climbed at the slowest pace in two years.

Inflation slowed to 4.6 percent from 4.8 percent in October, Pretoria-based Statistics South Africa said Wednesday in a report on its website. The median estimate in a Bloomberg survey was for 4.7 percent. Prices rose 0.1 percent in the month.

Price growth has now been within the Reserve Bank’s target range of 3 percent to 6 percent for eight months, the longest run since 2015. The Monetary Policy Committee reduced its benchmark rate for first time in five years in July after the economy fell into a recession early this year.

While the central bank forecasts inflation will remain within the target band until at least the end of 2019, it held the key rate unchanged at 6.75 percent last month and forecast more increases over the next two years as uncertainty about the nation’s credit rating and the outcome of the ruling party’s leadership race raised risks for the rand and prices.

Food prices climbed 5.2 percent from a year earlier, the agency said. That’s the slowest pace since November 2015 and compares with 5.3 percent in October.

The rand strengthened 0.3 percent to 13.6397 per dollar by 10:04 a.m. in Johannesburg on Wednesday. Yields on rand-denominated government bonds due December 2026 were unchanged at 9.27 percent.

Core inflation, which excludes the prices of food, non-alcoholic beverages, energy and gasoline, slowed to 4.4 percent in November, from 4.5 percent. That’s the slowest rate since May 2012.

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