By Thebe Mabanga
Consumer inflation accelerated more sharply than expected to 5% in June from 4.5% in May, reaching its highest level in two years as steep fuel increases spread into public transport costs, Statistics South Africa said on Wednesday.
The reading was the highest since June 2024, when inflation stood at 5.1%. Consumer prices increased by 0.7% between May and June, matching the monthly rise recorded in May.
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Transport was the largest driver of inflation, with prices rising by 12.7% from a year earlier and contributing 1.7 percentage points to the headline rate. The fuel index climbed by 34.3% year-on-year, reflecting increases of 50.8% for diesel and 31.7% for petrol.
The fuel surge filtered into passenger transport, where prices increased by 8.1% in June alone and were 12.5% higher than a year earlier. Minibus taxi fares rose by 11.5% month-on-month, while e-hailing services increased by 8.7%, long-distance bus fares by 8.4% and school transport by 3.7%.
Housing and utilities, which account for almost a quarter of the inflation basket, increased by 5.5% annually and contributed 1.3 percentage points to headline inflation. Electricity, gas and other fuels were 9.9% more expensive, while water and other municipal services increased by 6.9%. Insurance and financial services rose by 5.9%, adding a further 0.6 percentage points.
Food and non-alcoholic beverage inflation offered some relief, slowing to 1.6% from 1.9% in May and 2.9% in April. Cereal prices declined by 1.5% year-on-year, with white rice, maize meal, samp and porridge all cheaper than a year earlier. Meat inflation moderated to 5.1% from a peak of 13.5% in January.
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Underlying price pressures nevertheless strengthened. Services inflation rose to 5.2% from 4.7%, while goods inflation accelerated to 4.8% from 4.4%. Inflation excluding food, non-alcoholic beverages, fuel and energy increased to 4.1% from 3.8% in May, although the index excluding fuel was lower at 3.8%.
The figures were released a day before the South African Reserve Bank’s interest-rate announcement. The bank raised its policy rate by 25 basis points to 7% in May and is targeting inflation of 3%, with a tolerance band of one percentage point on either side.
