South African Inflation Rose to 4.7% in October

South Africa, the Africa's most developed country faces an increase in inflation rate to 4.7% in October. South African also doubt that under the leadership of Jacob Zuma the country will be able to rebound.

According to Nasdaq, annual inflation rate of South Africa rose slightly along with the increasing cost of food, pushing up prices. The report that come just a day ahead of the country's monetary policy committee meets on Thursday will be able to justify the central bank to increase rate. Althought many analysts and economists predicted that the South African central bank will keep interest rates on hold, because the slowing down of its economy. Due to that condition, Nasdaq also wrote about IMF prediction that South Africa will struggle to grow its economy at even 1.5% this year.

Bloomberg reported, according to Pretoria-based statistics office's announcement, the inflation rise from 4.6% in September. Amidst a slowing economy, it will give a hard time to central bank,led by Lesetja Kganyago to revive the economy. It is reported that the governor has taken gradual approach to raise interest rate by increasing the benchamrk repurchase rate three times to 6% in two years. Before the announcement, Jeffrey Schultz, an economist at BNP Paribas Securities South Africa said in his email note to clients, "The relatively benign domestic inflation path over recent months --thanks mainly to persistently soft fuel prices -- is likely to come as a welcome development for the South African Reserve Bank,"

South Africa economy is acounted for 24% of all Africa's gross domestic product. Its traditional sector in mining has now been diversified into other economic sectors. However, mining is still the largest industry sector in South Africa, as it has been the producer of important minerals and leader in world's mining and mineral-processing. Under current president, Jacob Zuma, South Africa's economy continue to decline.

South African's Independent even said that South African is almost as risky as Russia. Independent wrote based on Bloomberg report, that president Jacob Zuma's administration is battling to keep fiscal debt to less than 50 percent of gross domestic product as the economic backdrop continues to deteriorate. South Africa also has to fight falling commodity prices, and declining exports to China, its biggest trade partner. In addition, government's wage bill continues to climb. On top of that, IMF has noted that South African debt is likely to be more than twice that of Russia's for the next five years.

South Africa rising inflation rate will hurt the country's economy as its economy is already slowing down. IMF also predicted the country will struggle to grow its economy at 1.5%