South Africa's inflation was close to its peak, South African Econometrix economist Russell Lamberti said yesterday.

"Yesterday's figure is clearly in line with expectations and should continue upwards a little -- but CPIX is close to its peak," he was quoted by the South African Press Association as saying.

Petrol price cuts from September would have a clear impact on inflation, he added.

Earlier, Statistics SA said that CPIX inflation, which excludes mortgage costs, rose to a record 13 percent in July from 11.6 percent in June year-on-year.

The headline CPI annual inflation rate for July was up 13.4 percent in comparison to 12.2 percent previously.

Lamberti said investors were looking beyond the current upwards inflation cycle towards the time when the SA Reserve Bank would cut rates.

"We're looking at a cut around the second quarter of 2009," Lamberti said.

He added that the SA Reserve Bank would keep rates on hold in October.

"The unchanged decision in August paved the way for no hike in October."

The SA Reserve Bank has raised its repo rate 10 times since June 2006 in an attempt to halt inflation, which has exceeded its 3 to 6 percent target range since April 2007.

On August 14, the Reserve Bank's Monetary Policy Committee decided to keep the key rate on hold.