“While a rate cut would have been preferable, we are also pleased with the unchanged repo rate. This year our members are already facing steadily increasing prices in the food and transport sectors, without taking into account the electricity price hikes proposed by Eskom. Increases in the price of electricity will directly increase the cost of doing business, the prices of food and goods and services,” explained IMATU General Secretary, Johan Koen.
The headline CPI annual inflation rate in December 2012 was 0.1 % higher than the November 2012 rate of 5.6%. On average, prices increased by 0.2% between November 2012 and December 2012, with an average annual inflation rate of 5.6% last year.
Moreover, IMATU is pleased that Statistics South Africa will be implementing the new basket and weights for the Consumer Price Index (CPI) from next month. Stats South Africa has made changes to the list of products and services that are surveyed each month to measure the rate of inflation. Items in the CPI basket will now be more representative of the main categories of goods and services typically bought by households. The new CPI weights contain adjustments for used motor vehicles, restaurants, hotels, insurance, food and alcoholic beverages among others.
Another significant change being introduced is that there will be a basket for each large city, small town and rural area in each province. “This new categorisation will better record the purchasing patterns of all South Africans, increasing the ability of the CPI to effectively monitor changes in the price levels of consumer goods and services,” concluded Koen.