South Africa's April producer price index (PPI) is expected to increase by a median of 3.6% y/y, according to an I-Net Bridge survey of private sector economists. The range of forecasts is from 2.7% y/y to 4.0% y/y.
This compares with the median forecast for March of 5.5% y/y, while the actual was 5.1% y/y. In February the median forecast was 6.4% y/y, while the actual was 6.2% y/y.
In January the median forecast was 9.4% y/y while the actual was 8.1% y/y.
In December the median forecast was 13.4% y/y, while the actual was 12.4% y/y.
Statistics South Africa (Stats SA) will release the April producer inflation data at 11.30am on Wednesday.
Most economists said there was a risk that the numbers could surprise on the downside, given the strengthening in the rand in the past few months.
The rand ended at 8.59 rand per dollar in 2002 after ending 2001 at 12 rand per dollar. On April 30 it reached 7.05 - a new best level for this year. The August and September producer price rise of 15.4% y/y was the highest South Africa has experienced since August 1989, when it was 15.6% y/y.
As prices are taken in the first seven days of the month for most prices, except for imported crude oil and fresh food, where monthly average prices are used, only some of the rand strength was reflected in the first three months' data.
Base effects saw the y/y rate for imported manufactured goods ease to single digits in December 2002 to 9.5% - the first time they have been in single digits since September 2001 - from November's 11.9% y/y and October's 13.7% y/y.
Overall imported inflation eased to 0.5% y/y in March from 2.6% y/y in February, 4.3% y/y in January from November's 15.2% y/y, October's 15.6% y/y and September's 16.7% y/y.
In 1998, imported inflation bottomed at -2.4% y/y in February 1998 after being at 10.3% y/y in February 1997. It is probable that South Africa will have imported deflation around mid-year, provided the rand remains stable or continues to strengthen.
Following are the Stats SA PPI statistics for 2002:
2002 PPI y/y PPI m/m
December 12.4% -0.7%
November 13.9% 0.4%
October 14.6% 0.7%
September 15.4% 0.2%
August 15.4% 0.8%
July 15.2% 1.2%
June 14.4% 0.3%
May 14.9% 0.7%
April 14.8% 1.7%
March 14.1% 1.1%
February 13.2% 1.9%
January 11.5% 3.5%
2002 average 14.2%
2001 average 8.4%
2000 average 9.2%
Publisher: Business Day
Source: Helmo Preuss
South Africa's April producer price index (PPI) is expected to increase by a median of 3.6% y/y, according to an I-Net Bridge survey of private sector economists. The range of forecasts is from 2.7% y/y to 4.0% y/y.
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