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New-Look CPI From January
South Africa’s Consumer Price Index (CPI) is set to take on a new look from January next year which will better reflect the steep price increases faced by consumers.
This is according to The Financial Mail, who said the new-look CPI would likely give a larger weight to administered prices like food, electricity and fuel, which could possibly bias headline inflation of the new CPI basket upwards.
It said that while the official consumer price inflation rate was 6% many consumers would feel that this did not reflect their personal experience.
“This is partly because the CPI basket is underweight in precisely those items that many South Africans are forced to spend their income on,” said Claire Bisseker of The Financial Mail.
She said electricity was weighted statistically as 1,68% in the overall CPI basket; petrol had a weighting of 3,93%; water and other services to do with housing had a weighting of 3,31%; medical insurance had a 3,68% weight; and education’s weight was 2,19%.
Bisseker said the problem was that Stats SA introduced these weights in 2009 based on income and expenditure patterns of South Africans in 2005/2006.
“Since then, products and services with administered prices — like electricity and municipal rates and services — which most consumers have no choice but to pay, have generally been increasing far in excess of the general rate of inflation,” she said.
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New Vehicle Sales Growth Slowing
New vehicle sales in Q1 2012 grew at a slower rate than the same period last year, according to the National Association of Automobile Manufacturers SA (Naamsa).
Naamsa on Tuesday said that while there had been growth in new vehicle sales in the first quarter of 2012 the rate of growth had slowed compared to 2011.
“All sectors registered significantly slower growth during the first quarter of 2012 compared to the corresponding quarter in 2011,” said the association.
Naamsa’s quarterly review of business conditions listed these sectors as including passenger cars, and light, medium and heavy commercial vehicles.
The association said a total of 110,719 new cars were sold in the first quarter of 2012, 10% higher than the first quarter of 2011, while commercial vehicle sales reached 46,024 units sold, an improvement of 0,8%.
It said it expected domestic vehicle sales to increase in 2012, albeit at a slower rate than the past two years.
“Export sales are likely to remain under pressure in the short term and over the long term will remain a function of the performance and direction of global markets.”