Figures released earlier today showed that inflation (CPIX) in South Africa slowed down from 6.5% in the year to July to 6.3% in August. But this still remained above the central bank’s target of having inflation between 3% and 6%.

With the figures not meeting the central bank’s target, this means that we may have yet another interest rate hike in South Africa next month.

Just like most other countries in the world, South Africa’s consumers and producers have been borrowing a lot of money to fund their spending and as a result prices of commodities have been going up and thus we continually see a high inflation rate and the central bank’s target figures not being met.

Even though tighter monetary and credit policies have been put in place and taken some steam out of consumer spending and demand for credit, it looks like the central bank’s target may not be met in the medium term.

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