CPI slows to 3.5% in November but food inflation accelerates

South African consumer inflation slowed in November to 3.5% on an annual basis from 3.6% the previous month, but food prices remained worryingly on the boil.

The consumer price inflation (CPI) data, released on Wednesday, 17 December 2025 by Statistics South Africa (Stats SA), is still a source of Christmas cheer for South African consumers. Consumer inflation remains well within the South African Reserve Bank’s (Sarb’s) new target range, which is effectively 2.0% to 4.0%.

What this means

Inflation is on a downward trajectory, bringing relief to consumers and business alike. And inflation expectations are moderating, raising the prospect of more interest rate cuts in 2026.

It must be said that in a slow-growth economy with sky-high levels of unemployment, South Africa’s inflation numbers should be even lower.

Potential shocks in the New Year that could ignite inflationary pressures include the rand’s performance and the possibility that too much rain could produce less grain than expected.

On a monthly basis, CPI pointedly declined 0.1% in November from October. And the inflation outlook for 2026 remains promising – not least because the new target will help to anchor inflation expectations lower – with more rate cuts potentially on the horizon.

“The latest inflation survey shows that expectations have improved markedly since the third quarter: analysts forecast inflation to average close to 3.5% over the next two years, trade unions see inflation averaging 3.9%, while business managers expect inflation to hover around 4%,” Jacques Nel, Head: Africa Macro at Oxford Economics Africa, said in a note on the data.

“Overall, inflation expectations for 2026 and 2027 have declined by about 0.4 percentage points per year. The latest print will support the view that the inflation trajectory has undergone a downward adjustment.”

Food inflation remains a cause for some concern, notably because of its corrosive impact on the limited household incomes of the poor and working class. The November read on this front was 4.4% on an annual basis – a fairly benign number by historical standards but a worrying spike from 3.9% in October.

The annual rise in meat prices quickened in November to 12.2% from 11.4% in October – a reflection in part of the unfolding consequences of the foot-and-mouth disease outbreaks among South Africa’s cattle herd.

But overall, inflation’s trajectory in South Africa is braking and with the annual festive season upon us, hard-pressed consumers have some economic news to raise a glass to – though this is also becoming more expensive with alcoholic beverage inflation rising to 4.7% in November from 4.6% in October. DM