South Africa’s inflation rate has dropped to its lowest level in three years, according to official data released on Wednesday. The country’s annual consumer price inflation reached 4.6% in July, down from 5.1% in June, marking a significant decline after ten months of inflation remaining within the 5–6% range, the national statistics agency StatsSA reported.
The development comes amid South Africa’s ongoing struggle with long-standing economic challenges, such as elevated unemployment, extensive poverty, and limited growth.
StatsSA reported earlier this month that the country’s unemployment rate rose to 33.5% in the second quarter of 2024, nearing record levels. This means that 8.4 million people are currently out of work, a significant increase from 5.2 million in 2014.
While overall food inflation saw a slight decrease from 4.6% in June to 4.5% in July, prices for bread and cereals increased by 5.6%, up from 5.2% the previous month. Transport inflation also eased, falling from 5.5% in June to 4.2% in July, with fuel prices continuing to drop for a second consecutive month.
The central bank of South Africa has set an inflation target of between 3% and 6%, and in July, it opted to keep its main interest rate steady at 8.25%, amidst the ongoing economic challenges.