On a month-on-month basis, inflation quickened to 1.1%, compared to 0.6% in February – also as economists had expected.
Inflation is now at the upper end of the central bank’s 3-6% target band.
Nomura economist Peter Attard Montalto said it may bounce higher next month to 6.1% but is expected to slide down to just over 5% by the end of the year.
“However, in terms of the breakdown, crucially core (inflation) surprised to the downside by a notch at 4.4%. Food including non-alcoholic beverages also confirmed its decelerating trend, falling to 8.6% from 9.7% previously.”
The South African Reserve Bank targets a 3-6% level of headline inflation. The consumer price index has been outside that band since November.
The bank said last month inflation pressures are becoming more broad-based, reflecting a rising trend in both core and headline inflation. Reserve Bank governor Gill Marcus said she does not see inflation “running away”, but it is an area the bank needs to watch closely.
The bank expects inflation to peak in the second quarter at 6.5% from a previous forecast of 6.6%.