Further inflation slowdown 'cements' another rate cut, says economist

Stephen Grootes interviews Elna Moolman, Head of SA Macroeconomic Research at Standard Bank SA.

Consumer price inflation (CPI) slowed for a fourth consecutive month in September 2024, dipping below 4%.

Statistics SA said CPI eased to 3.8% in September, from 4,4% in August.

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That is the lowest in over three years since March 2021 when the rate was 3.2%.

On average, prices increased by 0,1% between August and September 2024.

Transport inflation continued to ease, with this category entering deflationary territory for the first time in 13 months.

Fuel prices dropped for a fourth successive month and are on average 9% lower than a year ago.

When it came to annual inflation for food and non-alcoholic beverages, the September figure was unchanged from August at 4,7%.

However, some food and beverage categories continue to witness high annual price increases (see below).

Stephen Grootes gets comment from Elna Moolman, Head of SA Macroeconomic Research at Standard Bank SA.

Moolman says this further drop in CPI cements another interest rate cut.

And after that November cut, she adds, they would still expect to see further cuts into 2025.

"Ultimately though, it is still likely to be a very shallow cycle, so we're looking for CUMULATIVELY one percentage point, of which we already have a quarter per cent... but at least providing a little bit of relief for consumers."

Elna Moolman, Head: SA Macroeconomic Research - Standard Bank SA

For more detail, listen to the interview audio at the top of the article