Hayley Parry, Money Coach and Facilitator at 1Life’s

Statistics South Africa released the latest consumer price inflation figures today, and they make for interesting reading. We can see that inflation ticked slightly higher from 3.5% in November to 3.6% in December. what’s most interesting is to look at this from a consumer perspective 2025 as a whole. I think one of the standout features is that the projected inflation rate of 3.2% for 2025 is the lowest in 21 years. This is down from 4.4% in 2024 and 6% in 2023.

But you might be looking at these figures and thinking: how is this related to my budget because it doesn't feel like an average of 3% of inflation for me and my personal budget I think where things really get interesting is when we look at the different spending categories and how each has been affected by inflation over the past year.

I like to look at what I call the “three Fs”: Fuel, Food, and Fees.

1. Fuel

There was an average increase of 0.6% in fuel prices over the 12 months to December. However, if you are driving a diesel car, your costs are sitting at 3.7% over the course of the year versus the 0.1% if you drive a petrol car. There is quite a significant difference between those two figures.

2. Food

Again, there's a big variety here, 2 examples are the following products: Eggs are 8.8% cheaper than they were a year ago while steak, on the other hand, is 29% more expensive, more expensive at the end of last year compared to the beginning of the year. If you have steak on your basket, this will definitely have a negative impact on your budget.

3. School Fees

School fees tell another interesting story; they showed an increase across more than 40 private schools in South Africa. Those schools average at 6.4% increase, with some schools going as high as 8.8%. In terms of increase, this is well above the projected average inflation rate of 3.2% for 2025.

For families with children in private schools, this above‑inflation rise places additional pressure on personal finances.

Where things become even more interesting is that the South African Reserve Bank is meeting on 29 January 2026. It will be worth watching Governor Kganyago’s decision in light of these latest inflation figures to see whether they translate into an interest rate reduction, which would offer consumers some relief.

Tando Ngibe, Senior Manager at Budget Insurance

The CPI results announced today means that prices in South Africa are still rising but at a relatively slow and manageable pace. Inflation came in at 3.6% - slightly higher than the previous month but still well within the Reserve Bank’s comfort zone.

Practically, for consumers, this means that your cost of living is not running away from you, but pressure hasn't disappeared either. Essentials like food, especially meat, housing costs, and transport, continue to put strain on budgets more than the headline number suggests.

While inflation looks calm paper, many households still fill it in their monthly spend. The important take away is that interest rates are unlikely to drop sharply in the short term but they are also under pressure to rise. So, borrowing costs should therefore remain relatively stable for now.

A practical tip going forward is to focus on controlling what you can. Focus on where the inflation is hitting your budget the hardest like groceries, fuel, rent and lock in savings were possible - whether it be through smart buying, switching service providers or avoiding new debt while the rates remain high. Inflation might be low overall but smart budgeting remains essential in 2026.