The latest consumer price index from Statistics South Africa shows that South Africa’s annual headline inflation increased to 5.9% in December 2021, up from 5.5 percent in November 2021.
According to Business Day, South Africa’s consumers will bear the brunt of cost increases as energy and petrol prices are expected to rise, and the Reserve Bank and government of South Africa are poised to remove the stimulus that has helped consumers cope with effects of the coronavirus outbreak.
The annual headline inflation fell close to the top limit of the South African Reserve Bank’s goal range, bringing the average inflation rate for 2021 to 4.5 percent, according to figures released by Statistics South Africa on Wednesday. The central bank’s ceiling goal range for headline inflation is set at 6%.
Increased consumer pressure as a result of rising energy and petrol prices, as well as the elimination of the stimulus, would stymie the recovery of an economy where household spending accounts for almost 60% of GDP.