Factory prices take a drop

Factory inflation eased back in December. Measured as the producer price index (PPI), it went down to 5.8% from 6.2% in November. This brought overall 2010 PPI inflation to an average of 6.0%, up from 0.2% in 2009, according to Tebogo Mosepele of Standard Bank. “Once again,” she added, “the year-on-year increase in PPI was driven mainly by increases in the prices of mining and quarrying (2.2 pps contribution) and electricity (1.5 pps) while the categories of basic metals (0.5 pps) and other manufacturers (0.4 pps) also increased.”