CPI spike may push Reserve Bank to increase rates: Analyst
Standard Bank Head of South Africa Macroeconomic Research, Dr Elna Moolman, says the hike in the Consumer Price Index (CPI) may lead to the Reserve Bank increasing interest rates in the future.
The annual headline inflation has climbed to 4% in April, up from 3.1% in March.
Data from Statistics South Africa shows the CPI rose by 1.1% month-on-month. The jump in the headline number was mainly driven by sharp fuel price increases.
“The Reserve Bank will naturally be concerned that the spike in fuel will ultimately spur broader or second-round inflation pressure, but it is too soon to assess this in this particular data set, as such pressures typically takes time to develop. We have already seen a notable increase in transport costs, ranging from taxi fares to e-hailing services to air fares to long-distance bus fares. These costs may very well increase further given the subsequent hikes in fuel prices. The Reserve Bank may hike interest rates in response to the rise underway in inflation, mainly to help ensure that it doesn’t feel second-round inflation pressure.”
#SAInflation || The fuel price index rose by 18,2% between March and April, the steepest monthly increase since the current #CPI series began in 2008.
Read more on the latest CPI figures here: https://t.co/Q9SWmVTOWV#StatsSA #KnowYourStatsZA #GovZAUpdates pic.twitter.com/PUuslZo83S
— Statistics South Africa (Stats SA) (@StatsSA) May 20, 2026