The Perfect Storm That Could Push Up Inflation

Inflation may increase for February due to rising international food prices, lower local crop yields, higher fuel costs, and increased medical expenses, contrary to earlier predictions made by economists. This could lead to the central bank maintaining the highest interest rates in 15 years for a longer period, pushing some economists’ expectations for rate cuts until later in 2024.

According to a farm-industry group, dryer and hotter-than-usual weather across South Africa’s main summer crop growing regions is hurting the outlook for the key corn harvest – raising risks for higher food-price inflation. State-owned power utility Eskom disagrees with parts of a report by a German consortium commissioned by the Treasury, which states that urgent maintenance is needed to prevent “catastrophic failure” at the raw water treatment plant shared by Medupi and Matimba power stations. Eskom denies that the two stations share a water treatment plant and says that they are unaware of any urgent maintenance needed

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Rising Food Prices May Push Inflation Higher in FebruaryRising international food prices, lower local crop yields, higher fuel charges, as well as increased medical costs may conspire to push inflation higher in February, contrary to economist expectations at the end of last year. This may force the central bank to keep interest rates at a 15-year-high for longer, with some economists already pushing back their rate-cut expectations to later in 2024.
Source: Fin24 - 🏆 21. / 63 Read more »