News
South African Inflation Eases; Rand Rallies
- South African Inflation Eases; Rand Rallies
Inflation unexpectedly eased in Africa’s second largest economy South Africa in August.
The consumer price index, which measures inflation rate, rose 4.9 percent year-on-year in August. Better than the 5.1 percent projected by most analysts.
Core inflation, excluding volatile energy and food items, was up 4.2 percent during the month, again better than the 4.3 percent reported in July.
South Africa’s economy slid into recession for the first time in nine years in the second quarter of the year following the drop in economic productivity and uncertainty surrounding emerging economies.
Still, the rand gained 1.7 percent against the U.S. dollar on Thursday to trade at R14.4.
The rand has lost more than 16 percent of its value since the beginning of this year due to weak domestic growth and unstable global commodity outlook.
The report was released ahead of South African Reserve Bank’s monetary policy committee meeting scheduled for Thursday.