South Africa’s annual consumer inflation rate edged up to 4.5% in September 2026 from 4.4% in August, as a sharp jump in fuel costs pushed transport inflation to 10.8%, according to Statistics South Africa’s consumer price index release. The consumer price index (CPI) rose 0.4% between August and September, after showing no change the month before. The rate came in below what economists had expected, but analysts warn that the October fuel increase is likely to push it higher.
Fuel drove the monthly increase
Stats SA lists transport, housing and utilities, and insurance and financial services as the three main contributors to the annual rate. Transport inflation of 10.8% added 1.5 percentage points to the headline figure, up from 1.2 points in August. Housing and utilities, at 5.2%, contributed 1.3 points, and insurance and financial services, at 5.4%, contributed 0.6 of a point.
The detailed tables show how much of this was fuel. The fuel index rose 6.2% in September alone and was 27.9% higher than a year earlier. Within the same table, the operation of personal transport equipment category was up 20.8% year on year, and passenger transport services rose 12.3%.
The split between goods and services also shifted. Stats SA reports that goods inflation climbed to 4.1% from 3.3% in August, while services inflation eased to 4.9% from 5.1%. Prices that are set or regulated by government and public bodies, which Stats SA calls administered prices, were 13.0% higher than a year ago, though excluding fuel and paraffin that figure drops to 7.0%.
Underlying inflation is lower than the headline
Measures that strip out the most volatile items paint a calmer picture. Stats SA’s series for CPI excluding food, non-alcoholic beverages, fuel and energy stood at 4.0% year on year, and the trimmed mean, a measure that discards the biggest price swings, was 3.2%. Excluding fuel altogether, headline inflation would have been 3.6%.
Food inflation remained subdued. BusinessTech reported food inflation of 1% against 0.7% in August, and Stats SA’s table shows processed food prices 0.7% lower than a year earlier while unprocessed food was 2.9% higher. Food and non-alcoholic beverages together fell 0.1% month on month, helped by a 1.6% monthly drop in vegetable prices.
Rentals also helped. According to BusinessTech, actual rental inflation slowed from 4.1% to 3.9%, and owners’ equivalent rent, an estimate of what homeowners would pay to rent their own homes, eased from 4.0% to 3.8%. PSG economist Johann Els pointed out that rentals carry a large weighting in the basket, which made the slowdown significant. He also described consumer goods inflation, which covers items such as furniture, clothing, footwear, appliances and vehicles, as well contained at 0.6% year on year.
Households feel the increase unevenly
Stats SA’s expenditure decile figures show that higher-spending households faced faster price growth. Inflation for the lowest expenditure decile was 3.3%, rising steadily to 4.8% for the top decile. The provincial picture also varied: Western Cape recorded 5.5% and Gauteng 4.3%, while Limpopo was at 3.0%. Inflation for rural areas was 3.1%, and the CPI for pensioners was 4.7%.
Utility costs remain well above the headline rate. Electricity, gas and other fuels were up 7.9% on a year earlier and water supply and miscellaneous services were up 7.4%. Electricity was flat on the month, while water rose 0.2%.
Economists expect inflation to climb further
The 4.5% reading was lower than forecasts. Reuters, carried by CNBC Africa, said economists it polled had expected 4.7%. SAnews reported that Nedbank had forecast 4.8% in its Weekly Monitor of 17 October.
The relief may be short lived. Anchor Capital, an investment firm, said that “September is unlikely to mark the peak in inflation,” pointing to October’s petrol increase of R3.33 a litre and the likelihood of a further rise in November. It said these could push headline inflation above 5% in the coming months. Anchor noted that Central Energy Fund data through 20 October pointed to average under-recoveries of about R1.52 a litre for petrol 95 and R1.25 a litre for diesel, which implies more upward adjustments at the next fuel price review.
The rand adds to that pressure. Anchor said it averaged R16.21 to the US dollar over the period used for October’s fuel adjustment but has since weakened to around R16.43, which Central Energy Fund estimates account for roughly 36c a litre of the petrol under-recovery and 45c a litre of the diesel under-recovery. Anchor also cited disruption to Middle East shipping routes, Houthi attacks on Red Sea trade and Ukrainian strikes on Russian energy infrastructure as factors behind Brent crude rising toward US$110 a barrel.
On the outlook beyond the next two prints, IOL reported that Els expects inflation slightly above 5% in October and November, with base effects starting to pull it lower from about April 2027. That path depends largely on oil prices falling next year, which is a forecast rather than something already visible in the data.
What it means for interest rates and business costs
For the South African Reserve Bank (SARB), Anchor said the softer underlying readings strengthen the case for holding the repo rate at 7.25% at its 19 November meeting, although it added that the SARB anticipates potential second-round effects, meaning fuel increases spreading into other prices. Economists are not united. Reuters quoted Nedbank economist Johannes Khosa as expecting another 25 basis point increase, while Lisette IJssel de Schepper, chief economist at the Bureau for Economic Research, said the bank could leave rates unchanged because core inflation is relatively contained.
Anchor also said that any fuel price relief announced in the Medium-Term Budget Policy Statement could moderate the eventual inflation peak, but it would be unlikely to materially change the broader near-term trajectory. The statement was due on the same day as the CPI release, and its contents were not available in the sources used for this report.
For companies, the practical point is that the cost pressure is concentrated in fuel and anything that depends on it. Businesses with large transport and logistics bills face the most direct exposure, while consumer goods, rentals and food are not yet showing broad price pressure. Shoppers and borrowers will be watching the next CPI release, which Stats SA lists for 18 November, and the SARB decision the following day. More coverage is in our Markets & Finance section.
