THE PRODUCER price index (PPI) fell from 3.3% year-on-year in April, to what Standard Bank economist Monica Ambrosi said “appears to be an historic low” of 1.1% in May. Domestic producer prices fell from 5.1% growth in April to 3.4% in May, while imported PPI continued to tumble from April’s -1.4% to -4.8%. “This bodes well for interest rates,” said Ambrosi, “and we would expect the SA Reserve Bank to trim interest rates further when it meets in mid-August. “It is now also more likely that the magnitude of the rate cut may be similar to the one in June.”
