Trouble for flight prices, and good news about South Africa’s greylisting

The South African rand remained stable on Wednesday, following data from the statistics agency indicating that the country’s year-on-year inflation rate held steady in February.

The rand was trading at 18.1325 against the dollar, close to its previous close of 18.1350. South Africa’s headline consumer inflation was recorded at 3.2% last month, the same level as January.

Economists had expected a slight increase in annual inflation to 3.3%. In addition, South African retail sales rose 7.0% year-on-year in January, following a revised increase of 3.2% in December.

On Thursday (20 March), the rand was trading at R18.10 to the dollar, R23.54 to the pound and R19.74 to the euro. Oil is trading lower at $71.21 a barrel.

Here are five other news stories making waves in South Africa today:

Flight prices: South Africa’s aviation industry is facing challenges in retaining talent in two critical areas: piloting and air traffic control. This retention issue could ultimately lead to significantly higher flight ticket prices for local travellers. [MyBroadband]

Greylisting: South Africa must demonstrate progress in investigating and prosecuting money laundering and terror financing by June. If successful, the Financial Action Task Force (FATF) will visit to evaluate the country. Passing this evaluation could lead to its removal from the greylist by October. [News24]

Interest rate decision: Today (20 March), South Africa’s Reserve Bank’s Monetary Policy Committee (MPC) will meet to decide on whether or not to adjust the interest rates. Economists expect a hold on interest rates in the country, with a few anticipating another 25 basis point cut. [BusinessTech]

JSE high: The Johannesburg Stock Exchange (JSE) jumped 1.41% on Wednesday, with the All-Share Index (Alsi) breaking through the 90,000-points mark for the first time, while the Top 40 index also hit a record high. [Moneyweb]

VAT disaster: Retailers are against any VAT increase, highlighting that South Africans are already struggling with the price of food while the expansion in the VAT zero-rated food basket will fall short of protecting the country’s most vulnerable households. “Pick n Pay does not support an increase in VAT at all, and frankly, it’s a disaster for South Africans who are already struggling to put food on the table,” a spokesperson said. [Business Day]