South Africa’s headline inflation slowed in March to within the central bank’s target range for the first time in four months, suggesting inflation may undercut the bank’s forecasts and ease pressure for action in the form of an interest rate rise. The fall was in line with expectations. However, retail sales showed a surprise jump, with 7.2 per cent annual growth in February, suggesting strong activity on the high street in Africa’s biggest economy. Most economists expect the central bank’s next rate move to be up as it seeks to contain inflation, but those expectations are going to be pushed back if price pressures continue to trend lower. Annual inflation braked to 6 per cent in the last month of the first quarter, from 6.1 per cent in February. The move back to the Reserve Bank’s 3-6 per cent band means inflation may now peak beneath the 6.5 per cent the bank has predicted for the second quarter of this year. “It seems that CPI may have already peaked and the coming months are likely to see smaller month-on-month increases, while the year-on-year rate could remain somewhat subdued, lingering not far from the current target level,” said Anisha Arora, an emerging market analyst at 4Cast.