In a welcomed development for motorists, the retail price of petrol has decreased by 92 cents per litre for both grades, effective from midnight. The wholesale price of diesel has also seen a reduction, dropping by 79 cents per litre, with the cost of lower-sulphur diesel falling by R1.05 per litre.
Azar Jammine, Chief Economist at Econometrix, highlighted the significance of these reductions, noting that they bring much-needed relief at the pumps. According to Jammine, the strengthening of the rand has played a crucial role in easing inflationary pressures, leading to four consecutive months of substantial fuel price cuts.
“The fact that the rand has strengthened has enabled inflation rate pressures to come down, and we have seen, as a result, this fourth consecutive month of big fuel price cuts," Jammine stated. He also pointed out that this trend could have further positive implications for the economy, suggesting that the inflation rate may drop below 4% in the coming months.
Jammine indicated that this lower inflation rate could pave the way for the South African Reserve Bank to cut interest rates by at least half a percent before the year's end, marking the first interest rate cuts in 18 months.
