Protesters holding placards saying "Stop Taxing Basic Food Items" sang as they marched through central Pretoria towards Union Buildings, which houses President Cyril Ramaphosa's office. In Cape Town, they marched towards parliament.
South Africa's headline consumer inflation rose to an annual 7.8% in July, its highest level since 2009.
Fuel prices were up 45.3% in June, their largest annual increase since the agency's consumer price index series began in 2009.
Union officials said more protesters were expected to join the marches as the day progressed, though it was not immediately clear if a call for a national shutdown to take place in more than 10 major cities would be successful.
"At the moment I'm not coping because there is no work and at my age, I'm struggling," said Helen Pont, 65, a former hotel receptionist, who was among protesters in Pretoria.
Labor unrest often affects sectors such as mining during wage negotiations, but it is rare for COSATU, South Africa's biggest union, to lead a national protest.
The Department of Public Service and Administration said in a circular to government departments that state employees participating in the COSATU-led protests, which were supported by unions from other federations, would not be paid.
COSATU previously led a national protest in October 2020 to criticize the government's response to the COVID-19 pandemic, in which jobs were lost during lockdowns.
Last month, the central bank delivered its biggest interest rate hike in two decades to try to curb inflation, despite four previous hikes