Experts warn that an increase in the consumer price index (CPI) is expected for June when Stats SA makes its announcement on Wednesday.
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Experts warn that an increase in the consumer price index (CPI) is expected for June when Stats SA makes its announcement on Wednesday.
Johann Els, chief economist at PSG, said that he expected headline inflation to rise from 4,5% in May to around 4,7% in June, reflecting a monthly increase of around 0,5%.
“The biggest impact will once again come from higher petrol prices, following the increase of 143 cents per litre during June. Food inflation should remain fairly moderate, while inflation in most consumer goods is still very subdued, much as we've seen over the past year.”
Els added that while 4,7% is higher than the Reserve Bank would like to see, it's important to remember that most of this increase is being driven by fuel prices.
“There is still very little evidence of meaningful second-round inflation effects. I expect inflation to ease back to around 4,3% in July (following a 201 cents per litre price reduction in petrol), remain around that level in August, and then drift towards 4,0% by year-end. On average, I expect inflation to come in at around 4,0% in 2026 before easing further to around 3,5% in 2027.”
Professor Simphiwe Madikizela, an economist at the University of South Africa (Unisa), said that South Africa's June 2026 CPI, due to be released by Statistics South Africa on the 22nd of July 2026, is expected to remain around 4,5% year on year, with the consensus forecast showing no change from May's 4,5%.
“From an economic perspective, I expect the following: headline CPI coming at 4,4% to 4,6% year on year, with the consensus centred on 4,5%. Month on month inflation is likely to remain moderate at around 0,3% to 0,4%. Core inflation is expected to remain relatively contained, suggesting underlying inflation pressures are still manageable.”
Madikizela added that CPI will be impacted by fuel prices during June, following geopolitical tensions in the Middle East that continued to feed into transport and logistics costs.
“Electricity tariffs remain elevated and continue to place pressure on household costs and expenditure, and some food categories, particularly meat and processed foods, have experienced gradual price increases due to the foot-and-mouth disease.”
“On the other hand, the downward pressures are the rand that has remained relatively stable; global food commodity prices have not surged significantly. With domestic demand remaining subdued due to weak economic growth and constrained household spending, limiting businesses' ability to pass on higher costs,” he said.
Lara Hodes, Investec economist, said that June’s CPI inflation reading is projected at 0,4% m/m, translating to 4,6% y/y, from 4,5% y/y previously.
“The petrol price rose by an additional R1,43/litre during the month, continuing to add upward inflationary pressure, although a cut was announced in July (R1,96/litre), providing some reprieve.”
Hodes added that food inflation, another key driver of the headline outcome, is likely to have remained largely contained in June, with meat prices having eased and grain mill price inflation supported by strong harvests, although some second-round effects from higher transport costs may have begun to filter into food prices.
“Food inflation, another key driver of the headline outcome, is likely to have remained largely contained in June, with meat prices having eased and grain mill price inflation supported by strong harvests, although some second-round effects from higher transport costs may have begun to filter into food prices.”
FNB Economists in their weekly expectations publication, said the South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) will meet next week against a backdrop of rising inflation expectations, easing global inflation pressures, and a still-fragile domestic growth environment.
“The key development since the previous meeting has been the deterioration in inflation expectations. The latest Bureau for Economic Research BER Inflation Expectations Survey showed a broad-based increase across major forecasting horizons.
Average expectations among analysts, businesses, and trade unions rose from 3,6% to 4,4% for 2026, while expectations increased to 4,2% for 2027, 3,9% for 2028, and 4,1% over the next five years.”
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