Consumer inflation slowed to an annual rate of 3.5% in November from 3.6% in October, driven by lower fuel costs. Data published by Stats SA on Wednesday shows the first moderation in the headline Consumer Price Index (CPI) rate in three months, bringing inflation closer to the Reserve Bank’s official 3% target and keeping it well within the tolerance band of plus or minus one percentage point. The softer-than-expected outcome strengthens the case for the Reserve Bank to continue cutting interest rates at its first monetary policy meeting in January.
The November print comes after the release of the Bureau for Economic Research’s (BER) inflation expectations survey on Friday — closely watched by the Bank — where respondents expect headline inflation to average 3.8% in 2026 and 3.7% in 2027, the lowest levels since the survey began in 2011. On a monthly basis, prices declined by 0.1%, offering a modest reprieve for consumers ahead of the December holiday period. The slowdown was largely driven by softer fuel and transport costs, though food prices remained elevated in some categories.
Fuel prices declined by 2.2% between October and November, with annual fuel inflation slowing to just 0.1%. That helped pull overall transport inflation down to 0.7% year on year from 1.5% in October. Food inflation, however, edged slightly higher to 4.4% year on year, up from 3.9% previously.
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Meat prices continued their upward climb, rising by 12.2%, reflecting ongoing supply chain pressures and increased demand. In contrast, prices for vegetables and fruit dropped by 2.3% and 2.4%, respectively, helping to ease pressure on household food budgets. Read:Bond yields tumble as rate cuts, mild inflation and huge foreign inflows buoy sentiment Housing and utility inflation remained sticky at 4.5%, underpinned by higher electricity and gas tariffs, which rose 7.9% compared to the same month last year.
Water and municipal services also recorded above-average increases of 7.0%. Core inflation, which excludes the more volatile categories of food, non-alcoholic beverages, fuel, and electricity, were slightly higher — 3.2%, from 3.1% in October. That measure, which is closely watched by the Reserve Bank as a guide to underlying price trends, remains within its tolerance range, but continues to suggest some stickiness in service-related costs. Services inflation climbed to 4.1% in November, up from 4.0%, while goods inflation eased to 2.9%.
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