South African inflation accelerated sharply in April, increasing the likelihood that the central bank will hike interest rates when it meets to assess its monetary policy stance next week.

Headline inflation came in at 4.0% year on year, up from 3.1% in March and reaching its highest level since August 2024, data from the statistics agency showed on Wednesday.

Economists polled by Reuters had expected annual inflation would speed up to 3.9%.

South Africa's central bank targets inflation of 3%, with a 1 percentage point tolerance band either side.

Statistics South Africa said the increase was driven mainly by sharp fuel price rises linked to the US-Israel war against Iran.

The statistics agency's fuel index rose 18.2% from March, and passenger transport services by 3.1%.

Africa's largest economy is highly exposed to rising global energy costs as it imports most of its fuel.

The central bank's next interest rate announcement is on May 28, and even before Wednesday's data many economists were predicting a rate hike after two consecutive "hold" decisions in January and March.

After the data Stanlib chief economist Kevin Lings said he expected a 25-basis-point hike next week as the central bank would want to show that it is serious about hitting its 3% target.

"They probably have to send a message around that," Lings told Reuters.

Investec chief economist Annabel Bishop also predicted a 25-basis-point hike.

But Standard Chartered's Razia Khan said she saw little immediate pressure for the central bank to tighten policy given a relatively modest increase in core inflation in month-on-month terms.

Core inflation came in at 0.5% month on month in April, slower than the previous month's 0.8% reading.