PPI slows to 6.5%
The headline Producer Price Index for May came in at 6.5 percent, compared to 7 percent in April.
|||Johannesburg - The headline Producer Price Index for May came in at 6.5 percent, compared to 7 percent in April.
As PPI is a leading indicator, this bodes well for inflation, which has slowed to 6.1 percent, just outside the South African Reserve Bank’s target range.
Statistics SA says from April 2016 to May 2016. the PPI for final manufactured goods increased by 0.3 percent.
The main contributors to the annual rate of 6.5 percent were food products, beverages and tobacco products as well as metals, machinery, equipment and computing equipment.
The contributors to the monthly increase of 0.3 percentage points were food products, beverages and tobacco products, coke, petroleum, rubber and plastic products, the government agency says.
The annual percentage change in the PPI for intermediate manufactured goods was 9 percent in May 2016 (compared with 7.1 percent in April 2016).
Read also: Producer inflation moderates to 7%
From April 2016 to May 2016 the PPI for intermediate manufactured goods increased by 2.1 percent.
The main contributors to the annual rate of 9 percent were chemicals, rubber and plastic products , basic and fabricated metals and sawmilling and wood.
The main contributor to the monthly increase of 2.1 percent was basic and fabricated metals.
However, Stats SA notes the annual percentage change in the PPI for electricity and water was 11.5 percent in May 2016, compared with 12.3 percent in April 2016.
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