PREVIEW-South Africa’s CPI inflation seen slowing again

| April 18, 2012 | 0 Comments

* Inflation seen at 6.0 percent y/y in March

* Lower food prices to take pressure off

* Retail sales seen up 4.8 pct in February

* For poll table, click here

JOHANNESBURG, April 17 (Reuters) – A moderation in South
African food prices is expected to slow consumer inflation for
the second month running in March, but it should resume its
upward trend in April on the back of higher fuel prices and a
weaker rand.

A poll of 17 economists surveyed by Reuters showed consumer
inflation is seen braking to 6.0 percent year-on-year in March
from 6.1 percent in February, within sight of settling back into
the central bank’s 3-6 percent target range.

“We expect food price inflation to continue to decline,
falling from 9.7 percent to 8.8 percent year-on-year,” said
Peter Attard Montalto, an emerging market economist at Nomura.

The main upside risk to inflation will emanate from global
oil prices while food price inflation is expected to moderate in
the short term, the Reserve Bank in its last monetary policy
meeting in March.

The Bank has left its interest rate unchanged at 5.5 percent
since the November 2010, after cutting it by 650 basis points in
the preceeding two years to aid economic growth and as inflation
remained largely benign.


But rising fuel prices should see inflation nudge higher in
April, while a weaker rand could also give rise to
import pressure.

“This (March) number is likely to be calm before the storm,
as the April inflation rate will likely be materially higher on
the back of (inter alia) sharply higher fuel prices,” said Elna
Moolman, an economist at Renaissance Capital.

Statistics South Africa will release the inflation data at
0800 GMT on Wednesday followed by retail sales numbers for
February at 1100 GMT.

DECENT RETAIL SALES GROWTH SEEN

Growth in retail sales is likely to have quickened to 4.8
percent year-on-year in March from 3.9 percent the previous
month, the Reuters survey showed.

Retails sales averaged 6.1 percent last year compared with
5.1 percent in 2010, with the last half of 2011 showing robust
growth.

Consumer demand remains a key driver of growth in Africa’s
biggest economy, and has been boosted by relatively lower
lending rates.

(Reporting by Vuyani Ndaba)

((vuyani.ndaba@thomsonreuters.com)(+27 11 775 3157)(Reuters
Messaging: vuyani.ndaba@thomsonreuters.com@reuters.net))


Keywords: SAFRICA INFLATION/

PREVIEW South Africas CPI inflation seen slowing again

Culled from here : Africa News

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