Statistics South Africa says that headline CPI rate in December was 6.8%.
Stats SA said on Wednesday that that this was 0.2% higher than the corresponding annual rate of 6.6% in November last year.
It said on average, prices increased by 0.4% between November 2016 and December 2016.
Economist Mike Shussler agreed that it was a "high number and not good for interest rates".
"I think the consensus was around 6.5%. It shows that the drought is still having an impact on the South Africa Society," Shussler told Algoa FM News.
"It's not good new for interest rates going forward and with the petrol hikes in January and likely to get in February it may even get worse," said Shussler.
