Johannesburg, 20 June 2018 – The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) is encouraged by the latest Consumer Price Index (CPI) figures released by Statistics South Africa (StatsSA) today, which indicate that the pressure on consumers is easing, despite the recent increases in VAT and fuel prices, the Federation’s Economist, Marique Kruger, said this morning.
According to the StatsSA data, the annual CPI was 4,4 percent in May 2018, down from 4,5 percent in April 2018. The index increased by 0,2 percent month on month in May 2018.
Ms Kruger said the latest inflation data bodes well for beleaguered businesses in the metals and engineering sub-sectors and the broader manufacturing sector, which are facing continuous headwinds.
“High fuel prices, increasing input costs and low levels of demand impact negatively on the margins of businesses, thus negatively affecting profitability. The situation is of great concern, especially given that this may signal the end of an interest rate cutting cycle by the South African Reserve Bank, which would have helped in boosting domestic demand. That is why the official data released today is welcome.”
In conclusion, Ms Kruger said it was encouraging that the data place the official inflation numbers lower than the mid-point of the South African Reserve Bank’s inflation target range of 3 percent to 6 percent.
Tel: (011) 298 9411 / 082 602 1725