"On average, prices increased by 0.3% between December 2009 and January 2010," said Stats SA.
CPI in December came in at 6.3% still falling outside the inflation target band.
In January the food and non-alcoholic beverages index increased by 0.7% between December 2009 and January 2010 while the transport annual rate increased to 6.2% in January from 3.4% in December 2009.
According to Stats SA, the monthly index decreased by 0.4% between December 2009 and January 2010 due to a decrease in the price of petrol (9c/l decrease in 93 octane and 6c/l decrease in 95 octane).
"The good news is that January is likely to be the last month that inflation will be above the target band - at least for this year," Nedbank economist Carmen Altenkirch told BuaNews.
Altenkirch said some upward pressure over the month likely came from services although this was likely offset by a further decline in prices of some durable goods like cars and lower petrol prices.
"Demand-side inflationary pressures in the economy are likely to remain subdued during the remainder of the year, although inflation is not expected to fall much below 5%," Altenkirch said.
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