2022 has been a turbulent year for South Africa, which experienced rising interest rates, unemployment, and record-high food and fuel prices, leading to a rampant increase in the cost of living for most South Africans.<\/p>\n
The cost of living in South Africa has been increasing over the past few years, with prices for food, transportation, and healthcare all rising. This can make it difficult for consumers to afford the things they need, particularly if they are already struggling with high levels of debt or low levels of income.<\/p>\n
Increases in the domestic price of fuel have been big news in South Africa throughout 2022, and motorists have been forking out more than R20 per litre of fuel for most of the year<\/a>.<\/p>\n South Africans with petrol vehicles are now paying R3.85 (19.6%) more for a litre of petrol, while diesel motorists are spending a significant R6.68 (38.7%) more for a litre since the start of the year when the price of 95 petrol was R19.61, and diesel was R17.24.<\/p>\n Kicking consumers while they are down is the sharp increase in food prices, partly due to the high fuel cost. According to Stats SA, the main contributors to the 7.4% annual inflation rate were food and non-alcoholic beverages; housing and utilities; transport; and miscellaneous goods and services.<\/p>\n Reflecting the higher levels of food inflation recorded in October 2022, the BFAP food basket<\/a> was 12% higher than its previous report, with the thrifty health food basket coming in at R3,298 per month, up R10 from September, and up R367 from October 2021.<\/p>\n Oils and fats had the highest price increases year-on-year, with inflation at 25.7%, followed by bread and cereals (19.5%), meat, milk, cheese and eggs (10.5%) and fish (10.3%).<\/p>\n Due to the economic hardships 2022 had to offer, South Africa’s unemployment rate also increased. The latest Quarterly Labour Force Survey (QFLS)<\/a>, published by Statistics South Africa on Tuesday (29 November), shows that official unemployment sits at 32.9% in the third quarter of 2022.<\/p>\n As a result of these realities, many consumers have had to revise their spending habits to weather the economic storm in 2022.<\/p>\n According to a survey by TalentLMS<\/a>, Employees battled the runaway costs of living by spending less. The results of the study showed that they pulled back spending on three main categories:<\/strong><\/p>\n 2023 expectations<\/strong><\/p>\n Unfortunately, South Africans still have a tough road ahead of them. Food inflation, fuel prices and unemployment are expected to remain elevated going into 2023.<\/p>\n The Bureau for Food and Agricultural Policy (BFAP) said that food inflation would likely remain high over the next three months as the full effects of persistently increasing commodity prices and weaker exchange rates filter through to retail markets.<\/p>\n “We expect that food inflation could peak in the first quarter of 2023, after which the higher base effects apparent from March 2022 will result in smaller inflationary effects during the rest of 2023,” it said.<\/p>\n The forecast for fuel prices isn’t any better, as the main underlying reason for the price increases, and will continue to be, is movements in the international price of crude oil \u2013 which accelerated after Russia invaded Ukraine in February 2022,\u00a0said<\/a>\u00a0University of the Witwatersrand professor Jannie Rossouw.<\/p>\n Additionally, interest rates will also remain elevated, as risks to the inflation outlook remain high, SARB governor Lesetja Kganyago said<\/a>, with the Russia-Ukraine war remaining an ever-present factor.<\/p>\n “Economic and financial conditions are expected to remain more volatile for the foreseeable future. In this uncertain environment, monetary policy decisions will continue to be data dependent and sensitive to the balance of risks to the outlook,” Kganyago added.<\/p>\n\n
\n