South Africa’s (SA) annual consumer price inflation (CPI) edged up slightly to 4.5% in September from 4.4% in August, according to the latest data from Statistics SA.

The increase was driven mainly by higher costs in transport, housing, utilities, and financial services. Even with the modest rise, the figures came in lower than market expectations. Investec Chief Economist Annabel Bishop noted that while inflation sits above the SA Reserve Bank’s preferred 3% target, the uptick is unlikely to push the Monetary Policy Committee (MPC) into raising interest rates at its November meeting:

“We don’t believe this is enough on its own to result in an interest rate hike at the November MPC meeting. However, inflation has remained removed from target for a fair period now due to extremely high fuel prices, the target being 3%. These very high fuel prices are a supply side issue. They’re not due to demand constraints or demand issues.”

While households continue to navigate these persistent cost-of-living pressures, the government is leaning on capital spending to stimulate economic activity, as detailed in the Medium Term Budget Policy Statement.

President Cyril Ramaphosa reiterated that ramping up infrastructure spending remains central to reviving the economy and driving job creation. The government has committed to expanding infrastructure investment at a rate of 5.2% over the medium term, making it the fastest-growing item in the national budget.

Highlighting the broader commercial spin-offs of the program, Ramaphosa emphasised:

“And I continue to say infrastructure is the real flywheel of our economic growth because it does not only deal with brick and mortar, it also deals with enhancing the various sectors of our economy, the manufacturing sector, the logistics sector and many others.”

By pairing targeted infrastructure investments with a cautious monetary stance, economic planners are aiming to build long-term capacity while keeping broader inflationary pressures contained.

–ChannelAfrica–