South Africa inflation drops to lowest in over four years

By Bhargav Acharya and Kopano Gumbi

South Africa’s inflation rate dropped sharply in October to its lowest level since the peak of the COVID pandemic, data showed on Wednesday, buttressing expectations for another interest rate cut by the central bank this week.

Statistics South Africa said falling fuel prices were the primary driver of the slowdown in annual inflation to 2.8% from 3.8% in September, with slowing food inflation another important factor.

October’s reading is the lowest inflation has been since June 2020, when South Africans were subject to one of the harshest COVID lockdowns worldwide. Inflation has only been below 3% in a handful of months in the past two decades.

Independent economist Elize Kruger said fuel and food price developments play a greater role in October, a month when there are typically fewer changes in the prices of other items.

South Africa’s government-regulated petrol and diesel prices fell