The much lower inflation rate should make it easier for the South African Reserve Bank to decrease the repo rate again on Thursday.
Inflation declined sharply in October to 2.8% from 3.8% in September to reach the lowest point since June 2020 during the Covid-19 pandemic when the inflation rate was 2.2%.
According to Statistics SA, which announced the inflation rate for October on Wednesday morning, falling fuel prices remain the primary factor behind the slowdown. Petrol and diesel prices decreased by 5.3% between September and October, taking the annual rate for fuel to -19.1%.
The price for inland 95-octane petrol in October was R21.05, the cheapest since February 2022 when the price was R20.14.
The aggregate transport index decreased by an annual 5.3%, pulling overall inflation down by 0.8 of a percentage point.
Food inflation also decreased after remaining steady for six months in the 4.5–4.7% range, with annual inflation for food and non-alcoholic beverages decreasing to 3.6% in October. This is the lowest rate since November 2019, when it was 3.5%).
Statistics SA says inflation cooled for most food and non-alcoholic beverages subcategories in October, except for sugar, sweets and desserts and cold beverages.
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