March Producer Pride Index seen at 7.9%
Business Live - Apr 23rd 2012, 14:29
SA's producer price index is expected to clock in at 7.9% year on year in March from 8.3% in February
Forecasts among 11 leading economists surveyed by I-Net Bridge ranged from 6.5% y/y to 8.4%.
Standard Bank research expected a 7.8% print in March, supported by a stronger rand and a moderation in food prices, said strategist at the bank, Thabi Leoka.
She said the rand strengthened in March, averaging around 7.6 against the dollar.
Commodity prices had also come down, she said, and that some soft commodities including corn had been on the decline.
"A softer March PPI and a further moderating CPI print should give the SA Reserve Bank enough comfort to leave interest rates at 5.5% this year," Leoka said.
Factors such as food prices which feed through into the agricultural prices of food and the cost of live animals and animal products; and the impact of oil price changes; and the sharp increases in the cost of metal ores, are still relevant and need to be taken into cognisance for their implications on PPI in the forthcoming months, say Econometrix economists.
If the decline in agricultural food inflation continues, it has the ability to knock a few points off the PPI, they said.
"In contrast with a heavy weighting of 4.98% within the overall PPI, an increase in oil price inflation risk may pose a negative threat to PPI," said Econometrix economists.
They noted that the appreciation of the rand dollar exchange rate from February to March might provide some relief to oil price inflation.
The March data is due to be released by Statistics SA at 11:30 on Thursday, April 26.
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