South African Inflation accelerates at alarming rate

South African inflation quickened for a third consecutive month amid mounting underlying price pressures.

The headline consumer-price index rose 7.8% from a year earlier, compared with 7.4% in June, Pretoria-based Statistics South Africa said Wednesday in a statement on its website.

This matches the median of 14 economists’ estimates and remains at a level last seen during the 2008-2009 global financial crisis, and is now the fastest inflation of Lesetja Kganyago’s tenure as central bank governor.

Core inflation, which excludes the prices of food, non-alcoholic drinks, fuel and electricity, quickened to 4.6%, breaching the central bank’s target range of 3% to 6% for the first time in more than four years.

The Reserve Bank’s monetary policy committee prefers to anchor inflation expectations close to 4.5%.

Kganyago has told lawmakers that headline inflation may be nearing a peak, though growing underlying price pressures may see the MPC continue its aggressive interest-rate hiking cycle.