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Production prices have continued to ease compared with 2016, with the continued deceleration in manufactured food price inflation.
Production prices have continued to ease compared with 2016, with the continued deceleration in manufactured food price inflation.

Producer inflation eases in April

ECONOMIC NEWS

By Sunita Menon - May 25th 2017, 13:09

Production prices have continued to ease compared with 2016, with the continued deceleration in manufactured food price inflation. 

The annual percentage change in the production price index (PPI) for final manufactured goods was 4.6% in April compared with 5.2% in March. From March to April the PPI for final manufactured goods increased by 0.3%.

The main contributors to the annual rate were food products, beverages and tobacco products (2.1 percentage points) and coke, petroleum, chemical, rubber and plastic products (1.2 percentage points).

Momentum economist Sanisha Packirisamy said: "Increased rainfall led to a plunge in crop prices at [PPI] level, which looks encouraging for bread and cereal prices in upcoming months. The favourable inflation dynamics playing out in cereal prices, however, are likely to be partly offset by further stickiness in meat prices."

At 25.17%, the food category makes up the largest portion of PPI.

Investec economist Kamilla Kaplan said: "Also exerting some downward pressure on PPI will be the fuel price cuts in March and April."
© BusinessLIVE MMXVII 

Read more about: sa economy | producer | ppi | inflation

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