- SA Nov PPI 0.2% m/m vs Oct -0.3%
Johannesburg, Dec 15 (I-Net Bridge) - SA's producer price index (PPI) registered growth of 10.1% year on year (y/y) in November from 10.6% y/y in October, Statistics SA (Stats SA) data released on Thursday showed.
The PPI, on a monthly basis, increased by 0.2% from -0.3% in October.
The PPI was expected to dip slightly at 10.5% y/y in November, a survey by I-Net Bridge found.
Forecasts among ten leading economists surveyed ranged from 10.1% y/y to 11.0% y/y.
Following are the reactions of leading economists:
CARMEN ALTENKIRCH, Nedbank economist:
"Producer inflation eased to 10,1% year on year (y/y), down from 10,6% y/y in October. The market had expected producer inflation to remain unchanged. Year-on-year increases in commodity prices and beneficiated metal products remain the main drivers of producer inflation.
"Lower commodity prices as well as weakening demand both locally and abroad, should contain producer price inflation during 2012. However, a key risk comes from the rand, which has weakened steadily in recent months. If the currency continues to depreciate, producer inflation will remain firmly in double-digit territory next year.
"Producer and consumer inflation will continue to edge higher in the coming months. Although the reserve bank will be mindful of adverse developments on the inflation front, the bank's focus will be tilted towards how the crisis in the eurozone continues to unfold, and how this impacts global growth, the functioning of financial markets as well as domestic growth prospects.
"With domestic growth under threat, the reserve bank will probably opt to keep interest rates unchanged until the 2012, despite the deterioration in the inflation outlook. However, should the global economy slip back into recession a cut in rates may be on the cards."
Frost and Sullivan economist CRAIG PARKER said:
"There was a significant slowdown in mining production, which would have contributed to November producer price index data. However input prices in general are still higher compared with 2010. We expect a further moderation in data next month from the current levels."
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