Inflation rises beyond market expectation

WITH THE government's inflation target measure (CPIX) rising at 8% year-on-year (y/y), the March inflation rate beat expectations, according to Standard Bank economist, Monica Ambrosi. This, she added, suggests a rapid price pass-through to consumers. "There is a concern that uncertainty over the actual magnitude of the rand's negative impact on prices could be leading to some opportunistic price increases." Has it, she asked, become a free-for-all? "Official statistics continue to show that inflation is rising beyond market expectations. The pressures driving inflation up also appear to be increasingly widespread, if the individual components are dissected. "Barring clothing and footwear, there are no other categories registering negative monthly price changes - and only a handful registered no change at all in March." It would now appear that monetary policy will tighten to stop this feeding frenzy, according to Ambrosi.