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CPI slows to 4.2% year-on-year in June
Wed, 28 Jul 2010 16:41



(Reuters) - South Africa's consumer inflation slowed more than expected in June, official data showed on Wednesday, leaving the door open for another rate cut before year-end.

Statistics South Africa said on Wednesday consumer inflation slowed to 4.2% year-on-year in June from 4.6 percent in May, beating forecasts of 4.5%. Inflation slowed for the sixth consecutive month.

The South African Reserve Bank (SARB) left the repo rate unchanged at 6.5% last week and warned about the impact of high wage demands on inflation after reducing rates by 550 basis points between December 2008 and March 2010.

"(The CPI print) certainly does look like a good number ...in that regard it would actually improve the possibility of a rate cut depending on the reasoning behind it," said Dennis Dykes, chief economist at Nedbank.

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