While these movements of the exchange rate of the rand reduced the international competitiveness of South African producers, it resulted in a decline in the year-on-year change of imported goods over the past 14 months, notwithstanding a significant increase in the international price of crude oil over this period. Goods price inflation therefore moderated further both at the production and consumer level.
By May 2004, CPIX inflation had been maintained within the 3 to 6 per cent target range for nine months in succession and the year-on-year rate of increase amounted to 4,4 per cent in each of the three months to May. Twelve-month growth in M3 remained brisk though it decelerated from 12,6 per cent in April 2004 to 11,9 per cent in May.