CPI increase driven by fuel, food

The inflation figure was higher than what economists had expected.

Statistics South Africa revealed CPI rose to 5,8 percent year-on-year. Picture: Craig Wynn/EWN.

JOHANNESBURG - The consumer price index (CPI) for January 2014 shows the annual inflation rate rose to 5,8 percent year-on-year, Statistics South Africa revealed on Wednesday.

The figure was higher than what economists had expected.

The CPI shows the average price increases for consumers in urban areas and is released on a monthly basis.

In January, average prices remained within the South African Reserve Bank's target bracket of three to six percent.

CPI increased by 0,4 percent from the December 2013 CPI figure.

Stats SA says the higher rate was driven primarily by an almost across the board increase in food prices with an average rise of 1,6 percent month-on-month.

That's a 4,3 percent increase from January 2013.

Fuel was also a major factor, with transport costs increasing by 1,2 percent since December and a massive 7,8 percent year-on-year.

FNB Chief Economist Sizwe Nxedlana notes the impact of these increases, but says they seem to have little bearing on the cost of other goods.

He says if input costs - food, energy and fuel - are excluded, the overall picture isn't particularly negative.

"What you find is that the measure of core inflation is relatively well contained - unchanged at annual growth rates of 5,3 percent year-on-year since September last year."

However, Nxedlana concedes that the effect of inflation is very dynamic depending on who the consumer actually is and what their basket generally includes.

"It depends on where in the basket you are most exposed. This is just the average inflation rate - a caricature of the average South African. But you may not be that individual."