Inflation cools, but red-hot food prices hit new high

Annual consumer inflation cooled to 6.9% in January, from 7.2% in December. This is the third consecutive month of a decline. But food inflation hit the highest rate since 2009.

The consumer price index (CPI) declined by 0.1% between December and January, Statistics SA reported.

Source: Statistics SA

Cheaper fuel helped to tame some prices, with petrol prices back to levels last seen in March 2022.

Still, food prices continued to race ahead. Food and non-alcoholic beverages inflation hit 13.4% in January – the highest level since April 2009.

Source: Statistics SA

Vegetables saw the biggest hike, with prices up more than 5% between December and January.

Source: Statistics SA

Bread and cereal prices were 21.8% higher than a year before. In a single month (from December to January), the prices of pizzas and pies rose by 3.6%, while maize (+3.1%) and brown bread (+1.3%) also saw large hikes.

Meat prices increased to 11.2% in January from the year before – from 9.7% in December.

Statistics SA reports that individually quick frozen chicken portions, which have the biggest weighting in the meat basket, rose by 2.7% in January from the previous month. Bacon prices were 19.4% more expensive than the year before, while fish prices rose 13% – the highest annual price increase since May 2009.

Inflation reached a 13-year high in July last year, hitting 7.8%. To cool inflation, the Reserve Bank has aggressively hiked interest rates. The monetary policy committee is meeting at the end of March to decide whether another hike is required. – news24.com