SA records lowest annual inflation since 2004

Zuko Komisa

2025 average inflation hit a 21-year low of 3.2%.
December headline CPI rose slightly to 3.6% from 3.5% in November.
Data arrives a week before the SARB decides on 2026’s first repo rate.

Statistics South Africa reported on Wednesday that while the monthly CPI rose by 0.2% in December, the overall annual trend remained subdued.

Patrick Kelly, Chief Director for Price Statistics, noted that the 2025 average of 3.2% is a significant drop, surpassed only by the 1.4% recorded in 2004.

The primary drivers for December’s 3.6% annual rate were housing and utilities (4.9%), food (4.4%), and financial services (7.0%). While goods inflation sat at 3.0%, services remained slightly higher at 4.2%.

Significant volatility was observed within the food basket. Meat inflation surged to 12.6% in December, a sharp contrast to the deflationary -0.4% seen a year prior.

Conversely, maize meal prices declined, and the dairy and eggs category remained in deflation at -1.1% due to cheaper milk.

The figures provide a critical benchmark for the South African Reserve Bank’s Monetary Policy Committee. Governor Lesetja Kganyago is expected to announce the first repo rate decision of 2026 next Thursday, with the market watching closely for any potential relief.