5 important things happening in South Africa today

·8 Aug 2022

Here’s what is happening in and affecting South Africa today:

Good news: Economists say South Africa’s food inflation may have peaked and will likely start easing from next month. Food inflation is far higher than headline inflation, with Nedbank economists expecting the number to hit 10% in July’s print before easing back to around 7% in August. Basket prices paint a different picture, currently up by almost 14% month-on-month – however, research groups also point to price stabilisation here. [News24]

Electricity prices: Eskom has hit back at proposed methodology changes to determine electricity tariffs in South Africa, saying that energy regulator Nersa’s proposals will lead to much higher prices. Nersa’s methodologies broadly and vaguely plot a way for Eskom’s tariffs to be cost-reflective, but the power utility says its current applications for tariffs hikes – which go as high as 32% – are not even there yet, so a true price reflecting its costs would be even higher. [Moneyweb]

High alert: The South African National Defence Force has placed soldiers on standby as tensions rise in the country and civil unrest becomes more pronounced. The standby note says that the 200 soldiers must be prepared to assist the SAPS in a secondary role if and when called upon. The reason for the deployment is that “the situation in South Africa is deteriorating into unrest”, with blame placed on criminal elements, who are taking advantage of a “perceived lack of action from security forces”. [TimesLive]

Zama zamas: Analysts say the SAPS’ latest crackdown on illegal miners in Mogale City is unlikely to make a dent in the more extensive organised crime network spread across the country. In a “show of force,” dozens of police officers descended on Krugersdorp and arrested close to 100 suspected illegal miners. However, it may be a case of too little too late, with illegal mining operations in the country stretching back at least two decades – while also feeding xenophobia among the populace. [Daily Maverick]

Markets: The rand remains very sensitive to shifts in global market sentiment. South Africa continues to battle with prolonged worker strikes and rolling blackouts, in addition to growing global recession fears. Meanwhile, some reprieve came for consumers as the government moved to cut fuel-pump prices to ease pressure on household finances and cool inflation. On Monday, the rand was trading at R16.78/$, R17.09/€ and R20.26/£. Brent crude is trading at $95 a barrel. [Citadel]

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