22 July 2026
South African consumers faced a sharper increase in the cost of living in June than economists had expected, with annual inflation accelerating to 5% from 4.5% in May, reaching levels last seen in June 2024 as higher transport costs pushed prices higher.
Statistics South Africa said consumer prices rose 0.7% month-on-month, while transport, housing and utilities, and insurance and financial services were the biggest contributors to annual inflation.
Transport made the largest contribution to the annual inflation rate as transport inflation accelerated to 12.7%. Housing and utilities climbed 5.5%, while insurance and financial services moved 5.9% higher.
Food inflation remained relatively subdued despite the stronger headline reading. Annual inflation for food and non-alcoholic beverages measured 1.6%, with cereal products continuing to record deflation at 1.5% and fruit prices down 10% compared with a year earlier.
However, meat prices were 5.1% higher than a year ago, while electricity, gas and other fuels increased by 9.9% and fuel prices were 34.3% higher than in June 2025.
Above expectations
Economists had expected annual consumer inflation to edge slightly higher in June, with forecasts ranging between 4.7% and 4.8%, largely due to higher fuel prices during the month.
Despite the anticipated increase from May’s 4.5%, inflation was expected to remain comfortably within the South African Reserve Bank’s target range of 3% with a band of one percentage point on either side.
Several economists have been viewing the uptick over the past few months as temporary rather than the start of a sustained acceleration in price growth.
PSG chief economist Johann Els expected annual inflation to rise to about 4.8% in June, driven primarily by higher petrol prices. However, he said ahead of the print that the increase will be short-lived, noting that the sharp fuel price cuts implemented in July should see inflation ease again to between 4.2% and 4.3%.
Source: IOL
