South Africa’s Retail Inflation Declines to Lowest in October since 2011

South Africa's headline inflation recorded 3.76 percent YoY in October as compared to 4.1 percent growth in September 2019, largely dragged down by petrol prices. While, on monthly basis it remained flat. This was the lowest print since February 2011. The current decline has pushed the inflation towards lower band of South African Reserve Bank’s (SARB) target band of 3–6 percent. Despite the lower inflation, reasonably stable currency and subdued consumer confidence and demand. The Monetary policy committee (MPC) of SARB kept the policy rate unchanged at 6.5 percent in November 2019. As per MPC observation, the retail inflation is expected to peak at 5.3 percent in the Q1 2020 and settle at 4.5 percent in Q4 2021.