South Africa's annual inflation eased in February, falling to the central bank's target of 3%, but analysts said the slowdown could be temporary as the ripple effects of the US-Israel war against Iran will show up in upcoming releases.

Headline consumer inflation slowed to 3% year-on-year in February, down from 3.5% in January, Statistics South Africa data showed on Wednesday.

Analysts polled by Reuters expected annual inflation would be 3.1% in February. The central bank's inflation target was lowered to 3% in November, and inflation was last at exactly 3% in June 2025.

A breakdown by Stats SA showed the main contributors to February's inflation rate were housing and utilities, food and non-alcoholic beverages, and insurance and financial services.

"This data largely predates the war on Iran though, as well as the resulting spike in oil prices and the weakening of the rand exchange rate, both of which will be ... inflationary," Elna Moolman, Standard Bank's head of South Africa macroeconomic research, said in a note.

Many economists expect South Africa's central bank to leave its main interest rate unchanged at its March 26 policy announcement, whereas before the war they had expected a rate cut. The bank maintained its repo rate at 6.75% at its last monetary policy meeting in January.