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Fuel prices rose 33.9% in a year. Expect spiking inflation - and interest rates

3 November 2021 8:52 AM
Tags:
Fuel prices
Food prices
Interest rates
Food price inflation
Inflation
Wages
Transport
Transport costs
Kevin Lings
Refilwe Moloto
stanlib
Breakfast with Refilwe Moloto
fuel price inflation

Refilwe Moloto interviews Stanlib Chief Economist Kevin Lings about the skyrocketing cost of living.
  • Fuel prices are 33.9% higher than 12 months ago, fueling price inflation of a number of goods

  • Expect higher interest rates in response

  • Food prices and transport costs far outstrip measured inflation; expect upward pressure on wages


© nomadsoul1/123rf.com

At midnight on Tuesday, punch-drunk consumers were hit with massive fuel price hikes that could have catastrophic economic consequences for South Africa.

A litre of petrol went up by R1.21 per litre to R19.50 (inland) while diesel spiked by R1.48 a litre to R17.23.

The announcement was scheduled for 28 October but only came 15 minutes before local government election polls closed on Monday, 1 November.

Refilwe Moloto interviewed Stanlib Chief Economist Kevin Lings about the skyrocketing cost of living (scroll up to listen).


RELATED: I love economics. It’s part of me - Kevin Lings (Chief Economist, Stanlib)


The prices have been moving up for a while… it’s now 33.9% higher than a year ago… 12 months ago we didn’t feel the effects, because we were still in lockdown…

Kevin Lings, Chief Economist - Stanlib Asset Management

… a huge amount of goods in South Africa is transported by road. That will put upward pressure on a range of goods… feeding into a broader price effect, and obviously, the Reserve Bank would have to respond through higher interest rates…

Kevin Lings, Chief Economist - Stanlib Asset Management

There’s a difference between measured inflation and experienced inflation… Food inflation is 7% and transport is going to be considerably higher than that… It will put upward pressure on wages…

Kevin Lings, Chief Economist - Stanlib Asset Management



3 November 2021 8:52 AM
Tags:
Fuel prices
Food prices
Interest rates
Food price inflation
Inflation
Wages
Transport
Transport costs
Kevin Lings
Refilwe Moloto
stanlib
Breakfast with Refilwe Moloto
fuel price inflation

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