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Tag: inflation

  • Ghana’s budget deficit strategy could trigger inflation and economic instability – Expert warns

    Ghana’s budget deficit strategy could trigger inflation and economic instability – Expert warns

    There’s growing concern among financial experts about Ghana’s plan to finance 63% of its 2025 budget deficit by borrowing money within the country.

    This approach, combined with recent rejections and low interest in Treasury Bills, has raised alarms about whether the government can meet its financial goals and what this could mean for the country’s economy.

    Finance expert Nelson Cudjoe Kuagbedzi has warned that the continuous rejections and low interest in Treasury Bill auctions could seriously harm the government’s ability to cover its budget shortfall.

    He pointed out that this trend has “significant implications for Ghana’s economy.” If the government can’t raise enough money within the country, it could lead to “increased borrowing costs, economic instability, inflation, currency depreciation, and even a sovereign debt crisis,” he explained.

    The problem of financing the country’s budget deficit is not new. Ghana has long struggled to generate enough revenue, mainly because it collects low taxes. Right now, Ghana’s tax revenue is only about 13.9% of its GDP, which makes it harder to meet the country’s financial needs.

    (Table showing T-bills auction trends from March 7-April 4, 2025)

    Nelson Cudjoe Kuagbedzi also acknowledged that borrowing to cover a budget deficit can be helpful to the economy if done carefully, as it can bring in needed funds and help stimulate growth. However, he also warned that “uncontrolled deficit financing can lead to inflationary pressures, widen income inequality, and create overall economic instability.”

    The current situation, where Ghana is relying heavily on local borrowing and seems unwilling to accept higher borrowing costs, presents a tough challenge. It’s unclear how the government will handle these difficulties and maintain a stable economy for the future. To succeed, the government will need to find different ways to raise money to meet its financial obligations without causing more problems for the economy. How the government balances its fiscal plans, investor interest, and borrowing costs will be key to shaping the country’s economic path in the coming year.

  • Inflation rate falls to 22.4% in March

    Inflation rate falls to 22.4% in March

    Ghana’s year-on-year inflation rate dropped to 22.4% in March 2025, down from 23.1% recorded in February, according to the latest report from the Ghana Statistical Service (GSS).

    On a month-on-month basis, inflation eased to 0.2% in March from 1.3% in February.

    The Government Statistician, Professor Samuel K. Annim, attributed the slowdown mainly to a reduction in food inflation, which fell to 26.5% in March, compared to 28.1% in February. Food inflation has now shown a consistent decline over two months.

    Vegetables, tubers, and plantains were the primary contributors to food inflation in March, continuing a trend from previous months. Meanwhile, non-food inflation saw a slight dip, decreasing to 18.7% in March from 18.8% in February. The month-on-month increase for non-food items stood at 0.7%.

    Items such as food and non-alcoholic beverages, housing, water, and electricity, as well as alcoholic beverages and tobacco, recorded inflation rates surpassing the national average of 22.4%. Specifically, food and non-alcoholic beverages saw inflation of 26.5%, housing, water, and electricity reached 25.1%, and alcoholic beverages and tobacco rose by 23.8%.

    Additionally, inflation for locally produced items fell to 24.0% in March, down from 25.1% in February, while inflation for imported goods experienced a slight increase, rising to 18.7% from 18.5% the previous month.

    On a regional level, the Upper West Region experienced the highest inflation rate at 36.2%, almost double the rate of the Volta Region, which recorded the lowest inflation rate at 18.9%.

  • We need a framework to create stable exchange rate, inflation, and economy – Finance Minister

    We need a framework to create stable exchange rate, inflation, and economy – Finance Minister

    Finance Minister Dr. Cassiel Ato Forson has stressed the need for a well-structured economic framework to restore Ghana’s financial stability.

    Speaking during a youth engagement session on X Spaces, hosted by social media influencer KalyJay on Sunday, March 9, Dr. Forson noted that tackling inflation, stabilizing the exchange rate, and fostering overall economic resilience would be the government’s key priorities.

    “What we can do is to put together a framework where there will be a stable exchange rate, stable inflation, and a stable economy,” he said.

    Despite recent measures to address Ghana’s economic difficulties, Dr. Forson acknowledged that the country’s financial situation remains precarious. He warned against any assumption that the economy had fully recovered.

    “Let me make this point: let’s not deceive ourselves that the country is out of the woods yet. Our economy is still in distress, and the first thing we will need to do is to take measures to bring us back to the stability that we deserve,” he cautioned.

    Outlining some of the government’s policy directions, he highlighted plans to cut domestic borrowing and reduce government spending to allow the private sector greater access to financial resources.

    “It is very critical for the government to cut expenditure and reduce its appetite for borrowing. In doing so, there will be a lot more resources for the private sector to benefit from,” he stressed.

    Dr. Forson also reassured the public that their concerns would be factored into the 2025 Budget and Policy Statement. Following his recent interactions with traders at Accra’s Central Business District, he emphasized that the government was actively listening to citizens’ input.

    “I do not take the people of Ghana for granted. I am not here because I just wanted to. I am here because I want to hear your take—ignore the propaganda out there,” he affirmed.

    The 2025 budget, set to be presented on March 11, is expected to outline key policies aimed at stabilizing the economy and laying a foundation for long-term recovery.

  • Ghana’s inflation falls to 23.1% in February

    Ghana’s inflation falls to 23.1% in February

    Ghana’s inflation rate dropped slightly to 23.1% in February 2025, down from 23.5% in January, marking the second consecutive decline this year.

    The marginal decrease was largely attributed to a reduction in food prices, according to the Ghana Statistical Service.

    The latest figures show that food inflation declined to 28.1%, while non-food inflation remained unchanged at 18.8%.

    On a regional level, the Upper West Region recorded the highest inflation rate at 35.5%, whereas the Volta Region reported the lowest at 18.1%.

    “In the last four months, you’ve seen a consistent decline in food inflation on a month-on-month basis, declining by 2.0 percentage points between November 2024 and February 2025,” Government Statistician, Prof. Samuel Kobina Anim, noted.

    With inflation showing signs of a downward trend, some analysts believe this could influence the Bank of Ghana’s monetary policy decisions. The possibility of a policy rate cut is being considered as the central bank aims to balance economic growth with price stability.

  • January sees Ghana’s inflation fall to 23.5%

    January sees Ghana’s inflation fall to 23.5%

    Ghana’s inflation rate dropped to 23.5% in January 2025, marking a slight decline after four consecutive months of rising inflation.

    The latest figures indicate a slowdown in price increases after inflation peaked at 23.8% in December 2024, missing the government’s end-of-year target of 15%.

    Food inflation, however, remains a concern, climbing from 27.8% in December to 28.3% in January. In contrast, non-food inflation continued its downward trajectory, easing from 20.3% in the previous month to 19.2%.

    Providing further insights into the inflation trend, Government Statistician Professor Samuel Kobina Annim stated:

    “In January 2025, general price levels of goods and services went up by 23.5%. Between January 2024 and January 2025, general price of goods and services went up by 23.5%.

    This indicates a disinflation as the rate of inflation has slowed down by 0.3 percentage points, slowing down from the year-end 2024 figure of 23.8% to 23.5% for the month of January 2025,” he explained.

  • Ghanaians are looking up to you to reduce inflation, stabilise the cedi – Mahama to Ato Forson

    Ghanaians are looking up to you to reduce inflation, stabilise the cedi – Mahama to Ato Forson

    President John Dramani Mahama has charged Dr. Cassiel Ato Forson, the newly sworn-in Minister for Finance, with the critical task of addressing Ghana’s economic challenges, including reducing inflation, stabilizing the cedi, and ensuring sustainable debt management.

    Speaking at a swearing-in ceremony held at the Jubilee House, where six ministerial nominees were officially inaugurated, President Mahama emphasized the weight of expectations placed on Dr. Forson to steer the economy towards recovery.

    “The people of Ghana are looking up to you, Dr. Forson, to reduce inflation and make life more affordable. They are looking to you to lower the cost of living, stabilize our currency, and make our debt level sustainable. You must also rein in the deficit so we can achieve macroeconomic stability,” the President urged.

    Ghana’s inflation stands a little over 20 percent and a dollar is worth over GHC14.

    The ceremony also marked the induction of five other ministers tasked with addressing challenges in key sectors. John Jinapor, now Minister for Energy and Green Transition, was tasked with ensuring consistent power supply and managing the energy sector’s debts.

    “Ghanaians are looking for stable and efficient power supply. They are also looking at you to manage the energy sector debt,” Mahama told Jinapor.

    Eric Opoku, the new Minister for Food and Agriculture, was challenged to tackle food security and make food affordable for Ghanaians. “Ghanaians are looking for food security and cheap, affordable food to fill their stomachs,” the President stated.

    In the Roads and Highways Ministry, Governs Kwame Agbodza was reminded of the public’s dissatisfaction with the state of Ghana’s roads. “You have the duty not only to maintain existing roads but to provide new roads for smooth transportation,” Mahama said, describing the portfolio as one of the most challenging.

    For Haruna Iddrisu, who now heads the Education Ministry, the directive was to improve educational quality and prepare Ghanaian youth for the job market. “You must work to ensure quality education and equip our young people with the skills they need to go into the world of work,” Mahama noted.

    Dr. Dominic Ayine, the new Attorney General, was tasked with reforming Ghana’s justice system to promote fairness and transparency. “The Attorney General will be required to reform our justice system to make it fair and transparent to all Ghanaians,” the President added.

    The swearing-in ceremony marked the beginning of what Mahama described as a crucial effort to address the pressing concerns of the nation. The six ministers, he said, bear a significant responsibility to deliver on the administration’s vision for progress and stability.

  • Our strong measures will reduce inflation to 8% – Ato Forson

    Our strong measures will reduce inflation to 8% – Ato Forson

    Finance Minister-nominee Dr. Cassiel Ato Forson has expressed confidence that Ghana’s inflation can be reduced to single digits through the implementation of robust fiscal policies, focusing primarily on expenditure control and financial discipline.

    Speaking during his vetting before Parliament’s Appointments Committee on January 13, Dr. Forson outlined his plan to stabilize the economy, emphasizing the need to curb excessive government spending while reducing the country’s dependence on borrowing.

    “If we introduce strong measures, particularly on the expenditure side, we will be able to reduce inflation to 8% plus or minus two,” he asserted, adding that achieving this target would pave the way for reopening Ghana’s domestic bond market and reduce reliance on treasury bills.

    The Ghana Statistical Service (GSS) has previously called for a broader, cross-sectoral approach to tackling inflation, stressing that the burden should not rest solely on the Bank of Ghana (BoG). The GSS urged the inclusion of all government ministries in efforts to manage inflation and stabilize the economy.

    Historically, the BoG has used monetary tools, such as interest rate adjustments, to control inflation. In 2022, the central bank raised interest rates significantly as part of its inflation management strategy. However, by September 2024, the policy rate was reduced to 27%, following a previous nine-month hold at 29%, as inflationary pressures persisted.

    Despite these interventions, the government’s end-of-year inflation target of 15% was missed, with the GSS reporting inflation at 23.8% in December 2024, up from 23.0% in November, driven largely by rising food prices.

    Dr. Forson emphasized the importance of fiscal discipline in restoring economic stability and rebuilding investor confidence. He stressed that the government must operate within its available resources, especially in the face of limited financing options.

    “Let’s deal with expenditure, let’s cut expenditure, and let us not pretend that there is money available,” he urged, calling for prudent financial management as a pathway to stability.

    The minister-nominee further committed to eliminating wasteful spending within the government, stressing that excessive borrowing should not be the default solution. “It is time for us to cut the waste, and I will lead the process,” he declared, urging collaboration from Parliament and other stakeholders to ensure the country stays within its financial means.

    Dr. Forson concluded by reiterating the need for streamlined government spending and responsible financial practices, warning that unchecked borrowing would only exacerbate Ghana’s fiscal challenges.

  • BoG can’t resolve inflation challenges, cross-sectoral approach needed – GSS

    BoG can’t resolve inflation challenges, cross-sectoral approach needed – GSS

    The Ghana Statistical Service (GSS) has emphasized the need for a collaborative, cross-sectoral approach to addressing inflation, stressing that the responsibility should not fall solely on the Bank of Ghana (BoG).

    The GSS has called for the inclusion of all government ministries in efforts to curb rising inflation and ensure economic stability.

    Historically, the BoG has relied on monetary policy tools such as interest rate adjustments to manage inflation. In 2022, the Bank implemented record-high interest rates as part of its inflation control strategy. By September 2024, the BoG reduced its monetary policy rate to 27%, the second rate cut since 2021, to ease borrowing costs and address inflationary pressures. Prior to this, the policy rate had been held at 29% for nine months following a reduction from 30% in January 2024.

    However, despite these measures, recent GSS data revealed that the government missed its end-of-year inflation target of 15%, as inflation surged for the fourth consecutive month, reaching 23.8% in December 2024, up from 23.0% in November. The increase was largely driven by rising food prices.

    In response, the Government Statistician, Professor Samuel Kobina Annim, reiterated the importance of a comprehensive strategy involving multiple ministries to tackle the root causes of inflation. Government Statistician, Professor Samuel Kobina Annim, stressed the necessity of moving the focus beyond the Central Bank’s actions alone.

    “We definitely need to move the conversation away from a Central Bank’s responsibility alone. We need to tackle inflation at least from two perspectives. Every sector ministry we talk about in our release should be responsible,” he said.

    “Our conversation focuses on the Ministry of Food and Agriculture. But, if you look at the items – transport, housing, water, electricity and gas are dominant divisions. These ministries should be part of the conversation in driving down the rate of inflation,” he added.

    Prof. Annim further highlighted the need for a multi-ministerial approach, emphasizing the importance of coordinated efforts.

    “It will be a challenge speaking directly to what different state institutions should be doing differently. Especially, when you don’t know the details of what they are doing, apart from what you are told or you read.

    “On the back of this, it will be important we step back and look at how Ghana Statistical Service is promoting the granular data from the headline figure. So we are calling for an inter-ministerial engagement if we want to bring down the rate of inflation,” he concluded.

  • Ghana ends 2024 with 23.8% inflation rate in December

    Ghana ends 2024 with 23.8% inflation rate in December

    Ghana ended the year 2024 with an inflation rate of 23.8% for December, missing the government’s target of 15%. This marks a slight rise from the 23.0% recorded in November, primarily driven by increased food prices.

    The December rate reflects the fourth consecutive monthly increase after a five-month decline earlier in the year. Food inflation surged from 25.9% in November to 27.8%, while non-food inflation slightly decreased from 20.7% to 20.3%.

    Explaining the figures, Government Statistician Professor Samuel Kobina Annim stated, “In December 2024, average prices of goods and services went up by 23.8%, indicating that on a year-on-year basis, specifically between December 2023 and December 2024, general price levels of goods and services went up by 23.8%.”

    He added, “This is against the backdrop that on a year-on-year basis November 2024, we recorded an overall rate of inflation of 23.0%, indicating that on a year-on-year basis between November and December 2024, we saw a marginal increase of 0.8 percentage points for the year-on-year inflation.”

    Disaggregating the figures further, Professor Annim noted, “Disaggregating year-on-year inflation from a food and non-food perspective, we identified a 7.5 percentage point difference between inflation for food and inflation for non-food, with inflation for food standing at 27.8% in December 2024 and non-food inflation at 20.3% for December 2024.”

    “We have seen an increase in food inflation, rising from 25.9% to 27.8%, and in contrast, we have recorded a decline in non-food inflation, declining from 20.7% by 0.4 percentage points to 20.3% for the month of December 2024,” he concluded.

  • BoG Governor projects inflation will fall to single digits by the first quarter of 2026

    BoG Governor projects inflation will fall to single digits by the first quarter of 2026

    Governor of the Bank of Ghana (BoG), Dr. Ernest Addison, has announced that the central bank expects inflation to drop to single digits by the first quarter of 2026.

    However, he mentioned that this projection depends on the economic policies and programs that the incoming John Mahama administration will implement in 2025.

    Dr. Addison shared this information during an appearance on Joy News’ PM Express Business Edition with host George Wiafe.

    In 2024, the BoG initially predicted inflation to end the year at 15%, but this forecast was later updated to 18%.

    By November 2024, inflation had slightly increased to 23% from 22.1% in October.

    Dr. Addison noted that inflation is expected to decrease due to the monetary policy actions taken by the BoG.

    “Based on the work that the Bank of Ghana has done in checking rising price levels through the inflation targeting policy, the inflation rate will slow down for this year (2025), he assured.

    “Inflation rate will hit 15 per cent by the end of 2025, from the current 23 per cent”, he assured.

    Dr. Addison explained that the increase in inflation was partly due to the election-related emotions and the uncertainty surrounding that period.

  • Ghana projected to achieve single-digit inflation by quarter 1 of 2026

    Ghana projected to achieve single-digit inflation by quarter 1 of 2026

    Ghana is expected to bring inflation down to single digits by early 2026.

    IC Research adjusted its prediction to the first quarter of 2026 due to the slow pace of reducing inflation and previous challenges with the exchange rate.

    “We also flag the renewed external policy uncertainty as a risk to exchange rate, energy, and food prices with a pass-through to inflation in 2025. However, the recent strong appreciation of the Ghanaian cedi will tame the price pressures in December 2024 into early 2025, potentially capping the upside risk”, it stressed.

    The Bank of Ghana (BoG) projected a modestly higher inflation outlook but remained cautiously optimistic about achieving single-digit inflation in the long term.

    In its June 2024 inflation report, titled “Canary in the Coal Mine,” IC Research adjusted its 2024 inflation estimate to a range of 19.3% to 21.3%, citing slow progress in reducing inflation and the increased likelihood of surpassing the BoG’s initial year-end target of 15.0% ± 2.0%.

    While the Monetary Policy Committee (MPC) did not provide an updated inflation forecast for the end of 2024, it indicated a slight increase in the one-year projected average inflation, rising to 20.1% compared to 19.0% in September 2024.

    Ghana’s annual inflation rate rose for the third consecutive month to 23% in November 2024, the highest since May 2024, up from 22.1% in October.

    The rise was largely driven by food prices, which jumped to 25.9% from 22.8% in the previous month, with staples like beans and yams contributing significantly to the increase.

  • Ghana’s Producer Price Inflation dropped to 26.9% in November – GSS

    Ghana’s Producer Price Inflation dropped to 26.9% in November – GSS

    Ghana’s Producer Price Inflation (PPI) dropped to 26.9% in November 2024, according to recent data from the Ghana Statistical Service (GSS).


    This marks a 6.1 percentage point decrease from October 2024, reflecting a slowdown in the rate of price increases at the production level.


    The month-on-month change between October and November 2024 also showed a decline of 1.9%, further indicating a reduction in inflationary pressures at the production stage.

    This drop in PPI points to an easing of cost increases across various sectors.


    The industrial sector, excluding construction, saw a significant reduction in producer inflation, which fell from 48.9% in October to 41.3% in November.


    This drop is a positive development, especially for manufacturing and industrial producers, as it signals a slowdown in rising production costs.


    Similarly, the construction sector experienced a decline in its producer inflation rate, decreasing from 34.5% in October to 31.1% in November.


    Despite this decrease, the construction sector’s inflation rate remains above the national average, highlighting the continued challenges the sector faces.


    In the services sector, producer inflation stood at 12.5% in November, reflecting a more moderate increase in prices.


    Meanwhile, the mining and quarrying sector recorded a producer inflation rate of 41.9%, and accommodation and food services saw a rate of 32.5%.


    The transportation and storage sector also experienced inflation of 31.7%.


    The water supply, sewerage, and waste management sector had the lowest producer inflation rate, with a modest 5.0% in November 2024.

  • Ghana to end 2024 with 18% inflation rate – IMF

    Ghana to end 2024 with 18% inflation rate – IMF

    Ghana’s inflation rate is projected to reach 18% by the end of 2024, the International Monetary Fund (IMF) has revealed in its latest Country Report. This marks an upward revision from its earlier estimate of 15%, reflecting persistent price pressures caused by a weaker cedi and the ongoing dry spell.

    The IMF noted that despite these challenges, Ghana’s macroeconomic outlook remains positive, buoyed by stronger-than-expected GDP growth in the second quarter of 2024. The Fund has consequently revised its 2024 growth projection upward to 4.0% from the earlier forecast of 3.1%, made during the second Economic Credit Facility (ECF) review.

    “Continued tight monetary policy will bring inflation back to the Bank of Ghana’s target band (8±2 percent) by end-2025,” the IMF stated, underlining the importance of maintaining fiscal discipline to curb inflationary pressures.

    The IMF’s analysis also highlighted ongoing fiscal consolidation efforts and the anticipated completion of Ghana’s debt restructuring as critical measures for ensuring public debt sustainability. It further projected that the country’s current account deficit would remain balanced until 2026, with international reserves expected to reach three months of import coverage.

    Despite the improved outlook, the IMF cautioned that significant downside risks remain. Externally, heightened geopolitical tensions in regions such as Ukraine and the Middle East, coupled with commodity price volatility, could adversely affect Ghana’s economy. These factors may lead to higher imported inflation and increased investor risk aversion.

    On the domestic front, the IMF warned of potential policy slippages ahead of the 2024 general elections or during the political transition period. Such setbacks, it said, could undermine macroeconomic stability, complicate debt restructuring discussions, and worsen domestic financing conditions.

    “If protracted, weak cocoa harvests could affect exports and growth prospects. More generally, Ghana is subject to risks related to climate shocks,” the IMF added.

    The Fund also expressed concerns that the disinflationary process is progressing at a slower pace than anticipated in the first half of 2024, while exchange rate volatility remains elevated.

    Former Finance Minister Seth Terkper has weighed in on the IMF’s latest assessment, describing it as a positive signal for Ghana’s economy.

    However, he emphasised that these improvements do not imply that all sectors of the economy are performing well.

    Ghana’s inflation outlook remains central to its economic recovery strategy, with policymakers expected to maintain tight monetary policies to steer inflation back to target levels. As the year progresses, the government’s ability to navigate risks and implement prudent economic policies will determine the resilience of Ghana’s recovery.

  • BoG’s inflation projections for 2025 shift amid mixed economic signals

    The Bank of Ghana’s latest assessment reveals a mixed outlook for Ghana’s economy, with inflation remaining a key concern. Inflation, initially expected to return to the 6–10% target band by the third quarter of 2025, is now forecast to stabilise within this range by the final quarter of the year. This adjustment reflects ongoing pressures from food and fuel price volatility, exchange rate fluctuations, and utility cost adjustments.

    Economic indicators suggest a recovery, with the Composite Index of Economic Activity recording a 2.2% annual growth in September 2024, reversing the contraction seen in 2023. Increased port activity, tourism, and private sector credit have contributed to this momentum. However, inflation remains a hurdle, with projections for 2024 averaging 20.1%, up from earlier estimates of 19%​​

    “Major drivers of the improvement in economic activity include increased port activity, households and firms consumption of goods and services , construction activities, credit to the private sector, and higher tourist arrivals. At the time of the last MPC meeting, average inflation forecast a year ahead which stood at 19.0 percent has increased slightly to 20.1 percent at this forecast round. The horizon for inflation to get back within the target band of 6 – 10 percent has slightly shifted forward to Q42025 from the original forecast period of Q32025,” the 121st MPC report stated.

    The International Monetary Fund (IMF) forecasts single-digit inflation by the end of 2025, marking a significant improvement from the current figures.

    The IMF also anticipates economic growth to accelerate from 2.8% in 2024 to 4.4% in 2025, buoyed by tighter monetary policy and structural reforms under the Extended Credit Facility programme. A Staff-Level Agreement expected to be approved this month is expected to pave the way for an additional $360 million disbursement before the end of the year, to hep bolster macroeconomic stability.

  • Inflation modestly increases to 22.1% in October

    Inflation modestly increases to 22.1% in October

    The inflation rate for October 2024 has risen slightly to 22.1%, up from 21.5% in September.

    Prof. Samuel Kobina Annim, the government’s statistician, explained to the media in Accra on Wednesday that this increase is largely attributed to higher food and non-food inflation.

    The 22.1% rate for October marks a 0.6 percentage point rise compared to the same period last year.

    “Disaggregating overall rate of inflation from your food and non-food perspective, we did record 22.8 percent for food inflation and 21.5 percent for non-food inflation for the month of October 2024″,

    “Non food inflation has also increased by 0.6 percentage point, increasing from 20.9 percent for the month of September 2024 to 21.5 percent for the month of October 2024″, Prof. Annim added.

    Locally produced items went up to 24. 6% compared to the 23.4% recorded in September.  Imported items saw a drop to 16.3% compared to the 17.0% recorded in October.

  • Inflation increases to 22.1%, up from 21.5% in September

    Inflation increases to 22.1%, up from 21.5% in September

    In October 2024, inflation rose slightly to 22.1%, up from 21.5% in September, spurred by increases in both food and non-food prices.

    This is the second monthly increase after a five-month downward trend. Food inflation climbed from 22.1% to 22.8%, while non-food inflation rose from 20.9% to 21.5%.

    Although the government aims for a year-end inflation rate of 15%, meeting this target may prove difficult given the persistent inflationary pressures and limited time remaining.

    More soon

  • Drop in inflation rates has improved business, consumer confidence – BoG

    Drop in inflation rates has improved business, consumer confidence – BoG

    The economy is beginning to recover, with both consumer and business confidence increasing, according to recent surveys by the Bank of Ghana (BoG).

    The August 2024 reports indicate significant improvement in overall sentiment, driven by lower inflation, robust GDP growth, and companies meeting their short-term targets.

    This boost in confidence is mainly due to continuous improvements in the macroeconomic landscape.

    Speaking at a press briefing after the 120th Monetary Policy Committee (MPC) meeting, Dr. Ernest Addison, Governor of the Bank of Ghana, emphasized the key drivers behind this positive outlook.

    “Consumer confidence improved on account of easing inflationary pressures, which has led to optimism about future economic conditions,” Dr. Addison noted.

    He further noted that business confidence has risen as companies achieved their short-term goals and expressed optimism about their future prospects, driven by improving economic conditions.

    This surge in confidence aligns with stronger-than-expected economic growth. Provisional data from the Ghana Statistical Service for Q2 2024 showed real GDP growth at 6.9%, a significant jump from 2.5% in the same period of 2023.

    Non-oil GDP growth was particularly notable, reaching 7%, compared to 3.1% a year ago.

    Leading the recovery was the industry sector, which grew by 9.3%, rebounding from a 2.6% contraction last year. The services and agriculture sectors also showed strong growth, recording 5.8% and 5.4% respectively.

    This economic recovery is further supported by key indicators suggesting sustained improvement in activity. The real Composite Index of Economic Activity (CIEA), a central bank tool for tracking short-term economic trends, grew by 1.6% in July 2024, a sharp reversal from the 2.8% contraction seen in the same period in 2023. Key drivers of this positive trend included increased construction, rising household consumption, and a boost in both exports and imports.

    Dr. Addison stressed that improvements in the macroeconomic environment were closely linked to the ongoing disinflation process, which remains on track.

    Headline inflation dropped steadily, reaching 20.4% in August, down from 22.8% in June 2024. Food inflation, in particular, fell to 19.1% in August from 24% in June, while non-food inflation also decreased slightly to 21.5%.

    “The disinflation process remains on track, supported by a tight monetary policy stance and easing food inflation,” Dr. Addison said.

    He also highlighted that the Bank’s core inflation measure, which excludes volatile items like energy and utilities, eased to 19.4% in August from 22.1% in June.

    This renewed consumer and business confidence is expected to fuel further economic activity. The Purchasing Managers’ Index (PMI), which tracks the performance of manufacturing and services, reflected this upward trend, rising to 51.1 in August from 50.1 in July.

    A PMI reading above 50 indicates expansion in business activity, reinforcing the belief that the economy is on a sustainable recovery path.

    The central bank projects continued economic growth, with inflation expected to ease towards its target range of 13-17% by the end of the year.

  • Ghana’s inflation will end in 2024 with 20.8% – Fitch Solutions projects

    Ghana’s inflation will end in 2024 with 20.8% – Fitch Solutions projects

    Fitch Solutions has forecasted that Ghana’s inflation rate will ease in the short term, ending 2024 at 20.8%, according to their “Ghana Inflation 2024 Consumer Outlook” report.

    Despite this positive trend, inflation will average 22.1% for the entire year, reflecting a significant reduction from the peak rate of 54.1% observed in December 2022.

    Inflationary pressures have already started to abate, with the rate falling to 20.9% in July 2024. Looking ahead, Fitch Solutions predicts that inflation will continue to decline into 2025, averaging 16.2% year-on-year.

    However, this rate remains above pre-pandemic levels, which saw an average inflation rate of 12.4% per year from 2015 to 2019. This ongoing inflationary pressure underscores the continued financial strain on consumers.

    The report notes a favorable trend in food prices, which are expected to decline further. This decrease in food inflation is anticipated to positively impact consumer spending on other goods and services. Food and non-alcoholic drinks account for over 42% of total household expenditure in Ghana, so easing food inflation should help alleviate some financial pressure on consumers.

    Nevertheless, certain key spending areas are experiencing rising inflationary pressures. Housing and utilities, as well as transport prices, have seen significant increases.

    Transport inflation surged from 5.6% year-on-year in January 2024 to 18.1% year-on-year by July 2024. Similarly, housing and utilities inflation rose from 22.6% year-on-year to 28.6% year-on-year over the same period. These rising costs in crucial household spending categories could pose challenges for consumer budgets and spending patterns.

    Fitch Solutions’ report highlights the mixed economic landscape for Ghanaian consumers, with easing overall inflation tempered by rising costs in essential spending areas. This situation emphasizes the need for ongoing attention to inflation management and its impact on household finances.

  • Imported inflation declined by 1.9% to 15.6% in July – Finance Minister

    Imported inflation declined by 1.9% to 15.6% in July – Finance Minister

    Inflation for imported items in Ghana declined by 1.9 percentage points, settling at 15.6% in July 2024, down from 17.5% in June 2024, according to the Minister for Finance, Dr. Mohammed Amin Adam.

    This was revealed during a press engagement on Thursday, August 29, 2024, where the Minister highlighted the country’s economic progress.

    Imported inflation refers to the increase in the prices of goods and services that are brought into the country from abroad. This form of inflation is influenced by factors such as exchange rates, global market conditions, and tariffs, which can affect the cost of imports.

    Overall inflation in Ghana also showed improvement, with the rate declining to 20.9% in July 2024 from 22.8% in June 2024. The month-on-month inflation rate decreased from 2.9% in June to 2.1% in July, largely due to a slowdown in the prices of both food and non-food items.

    Dr. Amin Adam noted that food inflation saw a significant drop, declining by 2.5 percentage points to 21.5% in July from 24% in June. Similarly, non-food inflation fell by 1.1 percentage points, from 21.6% in June to 20.5% in July.

    In addition to these positive inflation trends, the Ghanaian cedi has shown relative stability against major trading currencies since 2023. The Finance Minister pointed out that while the cedi experienced some recent pressures, these have since subsided. The depreciation of the cedi against the US dollar improved from 54% in November 2022 to 27.8% in December 2023, compared to 30% in December 2022.

    “The year-to-year depreciation of the cedi moderated to 7.7% in the first quarter of 2024, compared to 22.1% in the same period in 2023. The cedi cumulatively depreciated by 18.6% against the US dollar at the end of June 2024, compared to 22% in the same period in 2023,” Dr. Amin Adam explained.

    As of August 25, 2024, the cedi had depreciated by 21.5% against the US dollar, slightly better than the 22.1% recorded in the same period in 2023. The Finance Minister expressed optimism about the cedi’s future performance, noting that the month-on-month depreciation improved significantly from 6.1% in May 2024 to 3.1% in June 2024, and further to 2.1% in July 2024.

    “If this trend continues, I can assure you that our cedi will continue to hold against the major currencies,” Dr. Amin Adam said.

    He attributed the stabilisation of the cedi to several factors, including the Bank of Ghana’s monetary policy, strong fiscal consolidation, the Gold for Oil programme, and the Bank of Ghana’s gold for reserves programme. Additional measures include the centralised platform for foreign exchange bureaus, the implementation of the dynamic cash reserve ratio to absorb excess liquidity, and revised regulations on advanced payments of imports. Positive market sentiments following the disbursement of the third tranche of the IMF extended credit facility have also played a role in supporting the cedi’s stability.

  • IC securities projects August inflation to increase to 21.8%

    IC securities projects August inflation to increase to 21.8%

    IC Securities has forecasted that the inflation rate will rise to 21.8% in August 2024.

    “Although the sharper-than-expected deceleration in the July 2024 annual inflation significantly eases our concerns, we remain convinced that the August print will witness an upturn, stressing the need for caution in lower inflation and interest rate outlooks”, the investment firm said in its analysis.

    “We opine that even a slight increase in the August 2024 CPI will nudge annual inflation,” it noted.

    The firm added that it “foresees upside risk from the spill-over effect of the utility tariff hike in July 2024 although the relatively stable cedi could partly numb the impact.”

    “Consequently, we forecast annual inflation at 21.8% (+90bps) while the m/m [month-on-month] rate declines to 0.5% in August 2024.”

    Inflation in July dropped by 190 basis points to 20.9%, making it the fourth straight decline.

    IC Securities, however, noted: “The inflation outlook remains highly cautious amidst the lingering upside risk, especially with favourable base effect having been exhausted while election-related spending is expected in quarter 4, 2024.”

    “However, we estimate that the latest disinflation has widened the real interest rates with the ex-post real policy rate at 8.1% in July and the ex-ante real policy rate likely at 7.2% in August 2024.”

  • Inflation projected to rise to 21.8% in August 2024

    Inflation projected to rise to 21.8% in August 2024

    The recent depreciation of the Ghana cedi against major foreign currencies is expected to continue as foreign exchange liquidity remains limited.

    Last week, the cedi weakened against key trading currencies as foreign exchange availability remained constrained.

    Adding to market concerns, the Ghana Cocoa Board’s decision to potentially forgo its annual cocoa syndication loan has heightened uncertainty about the cedi’s near-term stability.

    Analysts also suggest that the recent Eurobond coupon payments by the government may have increased demand for foreign exchange funded by cedis, further contributing to the currency’s decline.

    During the past week, the cedi depreciated by 0.31% against the dollar, 1.82% against the pound, and 3.76% against the euro on the retail market. On August 26, 2024, the cedi traded at GH¢16.28 to the dollar, bringing its year-to-date loss to 24.57%.

    Meanwhile, Ghana is set to begin a 10-day Eurobond debt exchange this week, aiming to finalize the restructuring of its $13 billion Eurobond debt.

    According to Bloomberg, the exchange will allow investors to swap their existing bonds for two new options: DISCO and PAR.

    The DISCO option offers investors a haircut of up to 37%, with two new bonds maturing in July 2029 and 2035 at a 5% interest rate. The PAR option, on the other hand, provides a 1.5% interest rate on new bonds maturing in January 2037 without any haircut.

    Analysts anticipate that market uncertainties may ease following a successful exchange, which could alleviate some pressure on the cedi.

  • Why BoG vows to maintain tight monetary policy

    Why BoG vows to maintain tight monetary policy

    The Bank of Ghana has affirmed its dedication to sustaining a stringent monetary policy until inflation shows a consistent downward trend.

    In a statement to the International Monetary Fund, the Central Bank emphasized that its monetary policy is focused on returning inflation to its medium-term target of 8% ± 2%.

    “Our policy decisions will continue to be data-dependent to ensure a fast-paced and orderly disinflation path towards the inflation target; the BoG stands ready to adjust the policy stance to ensure inflation evolves as envisaged under our monetary policy consultation clause (TMU Section II)”.

    “We are committed to continue absorbing excess liquidity and making sure our policy rate is fully transmitted to the market. In doing so, we will review the increased reliance on reserve requirements and the new tiering framework to ensure they deliver on their objectives”, it further explained.

    The Central Bank stated that it aims to strengthen its inflation targeting framework by upgrading its Forecast and Policy Analysis System (FPAS), improving macroeconomic data collection, including the BoG inflation expectations survey, enhancing analytical capabilities, and refining its monetary policy communication.

    The Bank also plans to restore official international reserves to a minimum of three months of import cover by the end of the program.

    “As the difficulties affecting the cocoa sector hamper its ability to accumulate reserves and that payments to IPPs [Independent Power Producers] are larger than previously expected, coupled with the uncertainty about the timing of the debt restructuring, we are also requesting a modification of the QPC to add an asymmetric adjustor on debt service on instruments arising from the restructuring of bondholders’ and commercial creditor’s claims”.

    In light of the reserve accumulation goal and existing challenges, the Bank will stick to a gross foreign exchange intervention budget.

    In July 2024, the Monetary Policy Committee of the Bank of Ghana maintained the policy rate at 29.0% for the third consecutive time.

  • Monetary policy will remain tight until inflation firmly declines – BoG

    Monetary policy will remain tight until inflation firmly declines – BoG

    The Bank of Ghana (BoG) has affirmed its commitment to maintaining a stringent monetary policy stance until inflation shows a consistent downward trend.

    In July 2024, the Monetary Policy Committee of the BoG maintained the policy rate at 29.0% for the third consecutive time, as Ghana has experienced a fourth consecutive decline in the inflation rate. Currently, the inflation rate stands at 20.9%.

    In a statement to the International Monetary Fund (IMF), the central bank outlined its approach, which aims to steer inflation back within its target range of 8 ± 2 percent.

    BoG emphasized that its monetary policy decisions will remain data-driven to ensure a swift and controlled disinflation process toward the set inflation target.

    “Our policy decisions will continue to be data-dependent to ensure a fast-paced and orderly disinflation path towards the inflation target; the BoG stands ready to adjust the policy stance to ensure inflation evolves as envisaged under our monetary policy consultation clause (TMU Section II),” the statement read.

    Additionally, the central bank reiterated its commitment to absorbing excess liquidity and ensuring the policy rate effectively impacts the market.

    “We are committed to continue absorbing excess liquidity and making sure our policy rate is fully transmitted to the market. In doing so, we will review the increased reliance on reserve requirements and the new tiering framework to ensure they deliver on their objectives,” the bank stated.

    The BoG is also focused on enhancing its inflation-targeting framework, improving the Forecast and Policy Analysis System (FPAS), strengthening macroeconomic data collection (including the BoG inflation expectations survey), and sharpening its analytical capabilities and communication strategy.

    As part of its broader strategy, the central bank aims to rebuild Ghana’s official international reserves to cover at least three months of imports by the end of the IMF program.

    However, challenges in the cocoa sector, larger-than-expected payments to Independent Power Producers (IPPs), and uncertainties surrounding debt restructuring have prompted BoG to seek a modification of its Quantitative Performance Criteria (QPC).

    The request includes adding an asymmetric adjustor to address unforeseen debt servicing needs related to bondholders and commercial creditors.

    Despite these headwinds, BoG remains committed to adhering to its foreign exchange intervention budget as it works towards rebuilding reserves.

  • Ghana’s inflation plummets to 20.9% in July

    Ghana’s inflation plummets to 20.9% in July

    Ghana’s consumer inflation has continued its downward trend, falling to 20.9% year-on-year in July, marking the fourth consecutive month of decline.

    This represents a 2.1 percentage point decrease from June’s 23.0%, indicating a gradual relief from the economic pressures that escalated throughout 2023.

    In July, food inflation was reported at 21.5%, slightly above the 20.5% recorded for non-food inflation.

    Interestingly, the inflation rate for imported goods was 15.6%, significantly lower than the 23.3% observed for locally produced items.

    The ongoing decline in inflation, which started in March 2024 at 25.8%, signals a steady moderation in price increases.

    Over the past five months, this consistent reduction in inflation has offered some relief to consumers and businesses after a period of intense economic strain.

    On a month-to-month basis, the growth of inflation also slowed, with a 2.1% increase from June to July 2024, down from 3.2% in May. This two-month trend indicates that inflationary pressures are beginning to subside.

    Year-on-year data reveals a significant reduction in food inflation, now about 2.4 times lower than in August 2023, although food prices remain slightly higher than non-food items.

    Moreover, there is a clear difference between the inflation rates for locally produced and imported goods, with locally produced items experiencing a higher rate of 23.3% compared to 15.6% for imported ones.

    Government Statistician, Professor Samuel Kobina Annim, attributed the overall decline in inflation to decreases in both food and non-food categories, underscoring the broader economic impact of these reductions.

  • BoG maintains benchmark rate at 29% to combat inflation pressures

    BoG maintains benchmark rate at 29% to combat inflation pressures

    The Bank of Ghana’s Monetary Policy Committee has decided to keep the benchmark interest rate at 29 percent, a strategic choice intended to address inflation uncertainties caused by currency pressures, changes in utility tariffs, and increasing fuel prices.

    Economic analysts have characterized this decision as a cautious approach to managing the economy during these challenging times.

    In an interview with CNBC Africa, Karen Kwarteng, Head of Global Market Sales at Stanbic Bank Ghana, examined the effects of the central bank’s decision to maintain the benchmark rate at 29 percent.

    She pointed out that although there was a previous 100-basis point rate cut, keeping the current rate is seen as essential to temper inflation and support disinflation efforts in the latter part of the year.

    The Bank of Ghana has set an inflation target of 13 to 17 percent by the end of the year, in line with the government’s 15 percent goal.

    Karen Kwarteng also emphasized the importance of strong fiscal consolidation as a complementary measure to monetary policy.

    “Key government initiatives such as the Ghana.gov platform and the Ghana Integrated Financial Management Information System are pivotal in these efforts.”

    The Standard Bank Executive further expressed optimism about the appreciation of the local currency in the near term, attributing this to the restructuring of the €13.1 billion bonds and anticipated IMF disbursements in November.

    She noted that “These factors are expected to provide much-needed support to the currency despite ongoing challenges such as declining cocoa earnings, which have hampered the regulator’s capacity to intervene in the forex market.”

    In recent times, high lending rates, driven by elevated reference rates, have continued to pose challenges for businesses in Ghana seeking affordable credit.

    Nevertheless, Karen Kwarteng commended the resilience of Ghana’s banking sector, which has shown stability following the domestic debt restructuring program.

    She also acknowledged that “Support from regulatory and governmental bodies has been instrumental in this recovery, enabling banks to navigate the post-restructuring landscape effectively.”

    As Ghana navigates the challenges of inflation management and strives for economic stability, the collaboration between monetary and fiscal authorities will be crucial.

    The focus on fiscal consolidation, prudent financial management, and strategic monetary policy is aimed at addressing current economic challenges and paving the way for a more resilient and sustainable future for the country.

    The Bank of Ghana’s decision to hold the benchmark rate at 29%, therefore, reflects a strategic approach to managing inflation and economic stability.

    With continued efforts in fiscal consolidation and supportive monetary policies, the country will likely overcome current economic challenges and achieve sustainable growth.

    The resilience of the banking sector and optimism about currency appreciation further contribute to a cautiously positive outlook for the country going forward.

  • Ghana’s economy is worse off due to imported inflation – Business expert

    Ghana’s economy is worse off due to imported inflation – Business expert

    Ghana has recently experienced a surge in inflation, which has driven up the prices of goods and services.

    Additionally, transportation fares have also increased slightly due to rising fuel costs.

    In June of this year, the country’s inflation rate reached 22.8%.

    Addressing this issue at the Ghana Economic Forum in Accra on Thursday, August 8, 2024, Dr. Godwin Acquaye, CEO of the Business and Financial Times (B&FT), highlighted that Ghana’s import bill last year represented 21.5 percent of the nation’s Gross Domestic Product.

    He pointed out that the importation of goods is a significant factor contributing to the high inflation rate in Ghana.

    “We are a nation that imports virtually everything, and therefore we add to our woes by importing inflation from other countries. To put this in perspective, our import bill for 2023 was approximately GH¢180.7 billion, up from GH¢148.6 billion in 2022, according to the Ghana Statistical Services’ Trade Report published in May this year,” Dr. Godwin Acquaye stated.

    He added that, “Our nation stands at a pivotal moment in its history. There is an apparent global recession that steers us in the face. We are a nation that imports virtually everything, and therefore we add to our woes by importing inflation from other countries.”

    To address these challenges, Dr Acquaye said the government must adopt a unified long-term strategy, leverage expertise and prioritize policies that foster economic growth.

    Additionally, all sectors of the economy must be strengthened to boost investor confidence.

    This would accelerate investment and the growth process of businesses in the country.

  • End of year inflation rate expected to exceed 20%

    End of year inflation rate expected to exceed 20%

    The end of the year inflation rate is expected to exceed 20 percent, surpassing earlier market projections, despite indications of economic recovery.

    DataBank, a prominent financial services firm, predicts that inflation could reach as high as 23.5 percent due to rising fuel prices and a struggling cedi, with 19.5 percent being the best-case scenario.

    This forecast sharply contrasts with the Bank of Ghana’s (BoG) more optimistic January projection, which anticipated inflation decreasing to between 13 and 17 percent by the end of 2024.

    “We anticipate a sluggish decline in inflation, influenced by fluctuating fuel prices driven by external dynamics and a steady weakening of the domestic currency… We expect headline inflation to settle at approximately 21.5% ± 200 bps by the end of FY ’24,” Databank said in its Quarterly Strategy Report.

    The inflation rate has fluctuated since the beginning of 2024, varying from 23.1 percent to 25.8 percent year-on-year. Analysts attribute this trend to rising fuel prices and currency depreciation, which have disrupted the disinflation process. DataBank anticipates an increase in the August 2024 report.

    Following its 119th meeting, the Bank of Ghana’s Monetary Policy Committee (MPC) stated that some risks to the inflation outlook persist.

    “On domestic price developments, there is some uncertainty regarding the year’s inflation path given recent exchange rate pressures, upward adjustment in utility tariffs and increases in ex-pump fuel prices,” said BoG Governor Dr. Ernest Addison.

    He noted that these developments have resulted in a slightly elevated inflation profile for the year.

    “Even though inflation is expected to remain within the target year band, the risks are tilted slightly on the upside. This will require maintaining the strong monetary policy stance supported by strong fiscal consolidation efforts – including remaining vigilant to ensure that end-year inflation objectives are achieved,” he said.

    The cedi’s recent 7.57 percent monthly decline against the US dollar has increased import costs, leading to a sharp 3.2 percent rise in month-on-month inflation in May. This situation has compelled the central bank to keep its benchmark interest rate at a high 29 percent for the fourth consecutive period, despite early signs of economic recovery.

    The Composite Index of Economic Activity rose by 2.7 percent in the first quarter, up from 2.2 percent in the same period last year, while the Purchasing Managers’ Index also climbed, suggesting a gradual increase in demand-driven activities. However, these early signs of recovery are dampened by tight liquidity conditions, with broad money growth slowing to 31 percent from 43.1 percent year-over-year.

    The International Monetary Fund’s recent disbursement of US$360 million through its Extended Credit Facility has improved sentiment regarding Ghana’s debt restructuring efforts. Nevertheless, the Fund highlights the necessity for ongoing fiscal discipline and greater exchange rate flexibility.

    With the December 2024 general elections approaching, there are still concerns about the potential for spending-driven inflation. Analysts point out that the central bank is in a delicate position, needing to balance the risk of stifling economic growth with the need to control inflation expectations in a politically charged environment.

    The Bank of Ghana’s monetary policy committee is likely to maintain its cautious approach in the coming months. Economists predict the policy rate will stay at 29 percent to counter potential inflationary pressures from election-related spending.

  • Inflation could worsen by end of 2024 due to cedi depreciation – Economist

    Inflation could worsen by end of 2024 due to cedi depreciation – Economist

    Economist Dr. Theo Acheampong has raised concerns that ongoing exchange rate fluctuations might hinder the government’s ability to meet its year-end inflation target of 15 per cent.

    In his analysis of the recent Mid-Year Budget Review, Dr. Acheampong expressed confidence that the country could achieve its revised Overall Real GDP Growth rate target, which has been adjusted from 2.8 per cent to 3.1 per cent.

    However, he is less optimistic about the inflation target due to the impact of exchange rate volatility.

    Dr. Acheampong pointed out that many duties and taxes on imported goods are indexed in U.S. dollars. This practice exacerbates price increases when the local currency, the cedi, depreciates.

    “Most of the charges on the ICUMS platform are charged in dollars. This means that when the cedi depreciates, importers will pay more at the ports,” he explained.

    The economist noted that these additional costs are typically passed on to consumers, leading to higher prices for goods and contributing to inflation.

    “The importers will not bear that cost and will pass on the extra cost at the ports to consumers. This means consumers will pay more,” Dr. Acheampong said.

    He warned that such dynamics could undermine progress in controlling inflation and potentially cause the government to miss its target.

    Revised Macroeconomic Targets

    In light of the ongoing economic challenges, the government has announced revisions to its macroeconomic targets for 2024. During the Mid-Year Budget presentation in Parliament on July 23, Finance Minister Mohamed Amin Adam disclosed an upward revision of the Overall Real GDP Growth rate from 2.8 percent to 3.1 percent.

    The inflation target for the end of the year remains unchanged at 15 percent. Additionally, the Non-Oil Real GDP Growth rate has been adjusted from 2.1 percent to 2.8 percent. The government has also revised nominal overall GDP from ₵1,050 billion to ₵1,020 billion and Non-Oil GDP from ₵979 billion to ₵977.093 billion.

    Dr. Amin Adam highlighted that the Primary Balance on a Commitment basis will remain at a surplus of 0.5 percent, and Gross International Reserves (including oil funds and encumbered/pledged assets) are expected to cover at least 3.0 months of imports.

    Further adjustments to the fiscal framework include an increase in Total Revenue and Grants to ¢177,220 million (17.4% of GDP) from the previous budget target of ¢176,414 million (16.8% of GDP). This increase is largely attributed to higher Non-Oil Non-Tax Revenue, which has been revised from ¢14,837 million (1.4% of GDP) to ¢15,638 million (1.5% of GDP), reflecting dividends from interest accrued in the ESLA accounts.

    Dr. Acheampong’s warnings and the government’s revised targets underscore the ongoing economic challenges and the need for careful management to ensure financial stability and meet fiscal goals.

  • Producer Price Inflation surges to 25.9% in Ghana for June 2024

    Producer Price Inflation surges to 25.9% in Ghana for June 2024

    The Ghana Statistical Service (GSS) has reported that the Producer Price Inflation (PPI) rate for June 2024 surged to 25.9%, marking an increase from 23.6% recorded in May 2024.

    This represents a year-on-year rise of 25.9% from June 2023 to June 2024.

    Compared to May 2024, the PPI saw a 2.5 percentage point uptick, with a month-on-month change of 2.7% between May and June 2024.

    The Producer Price Index tracks the average fluctuation in the selling prices of goods and services received by domestic producers over time.

    The industry sector, excluding construction, experienced a rise in producer price inflation to 29.4% in June 2024, up from 28.5% in May 2024.

    In the construction sector, inflation also climbed to 29.4% in June 2024.

    Meanwhile, the services sector saw an increase from 11.4% in May 2024 to 12.2% in June 2024.

    Sectors such as mining, quarrying, construction, accommodation, and food services recorded inflation rates above the national average.

    Conversely, water supply, sewerage, and waste management activities had the lowest inflation rate at 2.6% in June 2024.

  • Producer Price Inflation rose to 25.9% in June, an increase from 23.6% in May

    Producer Price Inflation rose to 25.9% in June, an increase from 23.6% in May

    The latest data from the Ghana Statistical Service indicates that the Producer Price Inflation rate for June 2024 has increased to 25.9%, higher than the 23.6% recorded in May 2024.

    This rate indicates that between June 2023 and June 2024, the rate increased by 25.9 per cent.

    The increase represents a 2.5 percentage point surge in producer inflation relative to the rate recorded in May 2024. The month-on-month change in the rate between May 2024 and June 2024 was 2.7 per cent.

    The Producer Price Index measures the average change over time in the selling prices of goods and services received by domestic producers.

    Per the data, the producer price inflation in the industry sector excluding the construction sector increased to 29.4 percent in June 2024 from 28.5 percent in May 2024.

    The rate in the construction sector increased to 29.4 per cent in June 2024. In the Services sector, the rate increased from 11.4 per cent in May 2024 to 12.2 per cent in June 2024.

    While mining and quarrying, construction, accommodation and food services activities recorded inflation rates above the national average, the water supply, sewerage and waste management activity recorded the lowest rate of 2.6 per cent in June 2024.

  • Time Value: GHC1000 in 2021 is worth GHC450 now – Report

    Time Value: GHC1000 in 2021 is worth GHC450 now – Report

    A recent analysis by the 3News Research Desk has highlighted the significant impact of inflation on the purchasing power of the Ghanaian cedi.

    According to the report, GHC1000 in 2021 now holds the equivalent value of only GHC450 due to the steep rise in inflation.

    The report indicates that inflation has drastically reduced the purchasing power of 1000 cedis. What could be bought for GHC1000 in 2021 now requires a staggering GHC2,216.

    In 2021, Ghana’s inflation rate was approximately 9.98 percent. However, by June 2024, the inflation rate surged to 22.8 percent. This dramatic increase has substantially eroded the value of money, making everyday goods and services significantly more expensive.

    This steep inflationary trend has profound implications for consumers and businesses. For individuals, it means higher costs for basic necessities such as food, housing, and transportation, straining household budgets and reducing disposable income.

    For businesses, it translates to increased operating costs, which may lead to higher prices for goods and services, further perpetuating the cycle of inflation.

  • Near-term forecast of inflation remains unclear – Report

    Near-term forecast of inflation remains unclear – Report

    GCB Capital has revealed that despite the ongoing disinflation trend, the near-term outlook for inflation remains uncertain.

    While they anticipate continued disinflation through the latter half of 2024, they highlight that inflation levels remain elevated.

    “These prevailing upside pressures will continue to moderate the decline in inflation and we envisage possible reversals in the inflation trend in August and later in Q4 [quarter 4] 2024. While the cedi appears to have stabilized broadly against the major trading currencies following the raft of positive news since June, the lagged impact and the second-round effects of the prevailing inflationary pressures could linger, moderating the pace of disinflation”, it said.

    “Accounting for the prevalent upside risks to inflation in the near term, our revised model shows that inflation could struggle to close sub-20% even if the exchange rate pressures remain muted in 2H2024 [second half 2024]. Potential election-related expenditure in the lead-up to the December 2024 general elections could also increase GHS [Ghana cedi] liquidity in the economy and fuel demand-side inflationary pressures if not adequately mopped up”, it added.

    In June 2024, inflation decelerated to 22.8%.

    Despite this, GCB Capital anticipates heightened cedi liquidity in the system as the election season intensifies in the latter half of 2024, potentially exacerbating inflationary pressures.

    As a result, the firm suggests a slight chance of a small interest rate cut in July 2024, with stronger prospects in the September 2024 and November 2024 policy reviews.

    Overall, it predicts that nominal interest rates will remain resistant to significant declines in the foreseeable future.

  • Ghana currently holds 6th position in Africa for highest food inflation rates

    Ghana currently holds 6th position in Africa for highest food inflation rates

    Ghana currently holds the 6th position in Africa for the highest food inflation rates.

    In May 2024, Ghana recorded a food inflation rate of 22.6%, according to the World Bank’s Food Security Update.

    Malawi and Nigeria topped the list with food inflation rates of 40.7% and 40.7%, respectively.

    Following closely, Sierra Leone (32.4%), Egypt (31.0%), Ethiopia (25.5%), Angola (18.5%), and Zambia (16.2%) occupied the 3rd, 4th, 5th, 7th, and 8th positions.

    The World Bank reports that numerous African countries continue to struggle with persistently high inflation rates, particularly in food prices.

    “Domestic food price inflation remains high in many low- and middle-income countries. Inflation higher than 5% is experienced in 59.1% of low-income countries (no change since the last update on May 30, 2024), 63% of lower-middle-income countries (no change), 36% of upper-middle-income countries (5.0 percentage points higher), and 10.9 percent of high-income countries (3.6 percentage points lower)”.

    Inflation, marked by a persistent rise in the overall prices of goods and services, carries significant consequences for any nation affected by it. Moreover, one area profoundly impacted by inflation is the food sector.

    High food inflation poses severe implications for African nations, where food constitutes a significant portion of household expenditures.

    Escalating food prices heighten the risks of hunger and malnutrition in affected regions.

  • Ghana’s annual inflation rate continues to decline, reaching 22.8% in June 2024

    Ghana’s annual inflation rate continues to decline, reaching 22.8% in June 2024

    Ghana’s annual inflation rate continued its decline, falling from 23.1 percent in May to 22.8 percent in June this year.

    This indicates a month-on-month inflation rate of 2.9 percent between May and June 2024.

    According to the latest data from the Ghana Statistical Service, consumer prices have increased at their slowest rate since March 2022.

    For instance, food inflation, a significant factor, rose to 24.0 percent in June from 22.6 percent in May, showing a month-on-month inflation rate of 5.1 percent.

    Conversely, non-food inflation decreased to 21.6 percent in June from 23.6 percent in May.

    Furthermore, inflation for domestically produced goods reached 25.0 percent, while imported goods saw a rate of 17.5 percent.

    These new figures indicate progress towards the disinflation goal the government has been pursuing since the start of the year.

    This progress may prompt the Bank of Ghana to consider reducing the interest rate, which has remained steady at 29 percent following its 118th meeting in May this year.

    The Monetary Policy Committee of the Bank of Ghana is scheduled to announce its next decision on July 29, 2024.

  • Cost of producing goods and services surges by 6.8 %

    Cost of producing goods and services surges by 6.8 %

    In May 2024, the year-on-year inflation rate for all goods and services at ex-factory prices reached 23.6%, marking a notable increase from April 2024’s 16.8%.

    The month-on-month producer inflation rate was recorded at 3.0%.

    According to the Ghana Statistical Service, producer price inflation in the industry sector excluding construction rose to 29.2% in May 2024, up from 20.2% in April 2024.

    In the construction sector, inflation surged to 54.7% during the same period.

    In the Services sector, inflation also saw an uptick from 9.4% in April 2024 to 11.4% in May 2024.

    Sector-specific inflation rates above the national average (25.3%) were observed in Construction (54.7%), Mining and Quarrying (40.6%), Accommodation and Food Services Activities (25.9%), and Electricity and Gas (25.4%).

    Conversely, Water Supply, Sewerage, and Waste Management activities reported the lowest inflation rate at 7.4% in May 2024.

  • High inflation on food could become more severe – Seth Terkper

    High inflation on food could become more severe – Seth Terkper

    The Finance Minister during the Mahama administration, Seth Terkper, has disclosed that the current exorbitant food prices in the market could have been even higher if not for the rains.

    During an interview on Morning Starr with Francis Abban, Terkper mentioned that the favorable weather conditions the country experienced helped alleviate the severe impact on the food supply.

    “The current situation you’re talking about could have been worse if the rains had not been good. Of course, we know that if the rains fail because of heat and all that or drought. Any year the food [supply] has not been good, it has been tough.

    “The May season, for instance, it’s always been tough. It’s only that the economy has been robust to support it,” he observed.

    Terkper emphasized the importance of not viewing food prices in isolation but considering other crucial factors affecting them, such as the cost of fertilizer.

    He elaborated that one strategy to tackle the increasing food prices was to enhance the value of exports, which could be complemented by a robust export support system.

    “Exim Bank in our model was to look outward where Cocobod looks outward for farmers, only this time, it is going to look outward for those exporting already but need export finance. Those who are going to be adding value, so you need to get a loan in cedis and you export and then it is aggregated.”

    Although data from the Ghana Statistical Service indicates that food inflation is at its lowest point in 13 months, these seemingly positive figures do not accurately portray the challenging economic circumstances.

  • GCB Capital projects downward trend of inflation in coming months

    GCB Capital projects downward trend of inflation in coming months

    The disinflation trend in Ghana is anticipated to continue, albeit at a moderated pace, despite challenges such as the depreciation of the cedi and expected hikes in petroleum prices.

    GCB Capital, a financial advisory firm, has indicated that the near-term inflation outlook appears elevated. This is attributed to the lagged impact of the cedi’s depreciation, increases in transport fares, and the implementation of the second-quarter 2024 utility tariff adjustment, which are expected to moderate the pace of disinflation in the second half of the year.

    However, the continuous disinflation is expected to be driven largely by a favourable base drift, which should sustain the decline in year-on-year inflation. GCB Capital also expects the imminent main crop harvest season to boost disinflation in the food basket.

    Additionally, the recent UN-backed cease-fire talks between Israel and Hamas, along with the US Federal Reserve’s likely delay in changing interest rates, are seen as positive developments that could improve the outlook for crude oil supply, further supporting the disinflationary trend.

    Furthermore, the imminent completion of the second review of Ghana’s programme with the International Monetary Fund and the release of catalytic funding are expected to improve the foreign exchange reserve cushion and trigger a marginal correction, sustaining the disinflationary trend.

    Inflation in Ghana reached a 26-month all-time low in May 2024, easing to 23.1% in the Consumer Price Index (CPI). This decline was largely driven by base effects, although price pressures from cedi depreciation, transport fare hikes, and seasonal food price effects had a moderating impact.

    While the decline in inflation was expected, the pace was slower than anticipated due to these factors. The food basket recorded a sharp disinflation in May, despite a significant increase in the food CPI from April, indicating a more complex inflationary environment.

  • May 2024 records 25% to 23.1% drop in inflation

    May 2024 records 25% to 23.1% drop in inflation

    The inflation rate in Ghana slightly declined from 25% in April 2024 to 23.1% in May 2024.

    Professor Samuel Kobina Annim, Government Statistician of the Ghana Statistical Service, disclosed this information during a press conference in Accra on Wednesday, June 12, 2024.

    May 2024 witnessed a 3.2% reduction in month-on-month inflation.

    As per data released by the Ghana Statistical Service (GSS), food inflation was the primary factor contributing to the overall decrease in the inflation rate.

    Food inflation for May stood at 22.6%, compared to April’s 26.8%, indicating a slowdown from the 2.7% increase recorded in April 2024.

    Non-food inflation experienced a 3.6% month-on-month increase.

    The Consumer Price Index monitors changes in the price level of a fixed basket of goods and services purchased by households.

  • Ghana’s inflation currently stands at 23.1%

    Ghana’s inflation currently stands at 23.1%

    Inflation for May 2024 has seen a substantial decline, dropping to 23.1% from 25.0% in April 2024, marking a 1.9 percentage point reduction.

    The Ghana Statistical Service attributes this overall decrease to a reduction in food inflation, which fell to 22.6% from 26.8% the previous month.

    Conversely, non-food inflation experienced a slight increase, rising to 23.6% in May 2024 from 23.5% in April 2024. Inflation rates for both locally produced and imported items also decreased, with locally produced items falling to 24.7% and imported items to 19.6%.

    Addressing journalists in Accra, Government Statistician Professor Samuel Kobina Annim emphasized the need for policymakers to address transportation costs, which saw a month-on-month inflation rate of 10.5%, rather than focusing solely on food inflation as the main driver of the overall inflation rate.

    “In this case what I want the media and policymakers to engage is not food inflation but in this case, transport where we are seeing month-on-month transport inflation of 10.5% when overall month-on-month is 3.2% and we all do appreciate how transport permits across the other items that we have in the basket for the competition.

    “So the conversation that I really wish will be on the table going forward is how do we ensure that the consistent but slow increases in prices of food at other points would slow down and possibly see reduction going forward.”

  • Krom ay3 shi! – Minority leader ‘cries out’ over exorbitant food prices on the market

    Krom ay3 shi! – Minority leader ‘cries out’ over exorbitant food prices on the market

    The Minority Leader, Dr Cassiel Ato Forson, has raised concerns over the alarming trends in food prices, which have skyrocketed since the beginning of the year.

    According to him, the recent report from the World Food Programme (WFP) for March 2024 has revealed that more than one million Ghanaians are likely to face food insecurity between now and August due to rising food prices.

    This, he says, is increasingly dire.

    “Mr. Speaker, the projections and statistics on the food situation in Ghana are grim. For instance, the price of a bucket of tomatoes has seen a dramatic increase of 140%, going from GHS75 at the start of the year to GHS180 currently. Similarly, the cost of a crate of tomatoes has surged by over 360%, rising from GHS1,500 in January to GHS7,000 in June. The price of a sack of onions nearly doubled in just one week, jumping from GHS600 to GHS1,050.

    In addition, a sack of kokonte, which was sold for GHS900 in December 2023, now sells for GHS1,100, marking a 22.2% increase in just five months. The price of a tuber of yam has increased by 20%, from GHS25 in December 2023 to GHS30 currently. Even a 5kg bag of rice, which sold for GHS170 in December 2023, now costs GHS185, reflecting an approximate 9% rise.

    He pointed out that this phenomenon is particularly noticeable with popular local foods.

    “I am sure those of you who have bought Ga Kenkey or Nkran dokon lately, will appreciate the food shrinkflation that I am talking about.”

    The Minority Leader summed up the situation by stating “Mr. Speaker, kurom ay3 hye. Times are very hard! Ghanaians are suffering!”

  • Inflation predicted to drop to 21% in May 2024 and to 17% by year’s end

    Inflation predicted to drop to 21% in May 2024 and to 17% by year’s end


    In May 2024, inflation is projected to decrease to a level of 21% and is anticipated to conclude the year at approximately 17%.

    GCB Capital attributes this to base effects.

    Nevertheless, it voiced apprehension regarding the expected transmission of the ongoing depreciation of the cedi and its delayed repercussions, stating, “The secondary effects continue to pose an upward risk to the short-term forecast.”

    “We have also seen the multiple upward adjustments in ex-pump petroleum prices, which result in transport fare hikes, and its full pass-through to general prices is yet to come. With the quarterly utility tariff adjustment still to come amidst the general macroeconomic uncertainties, the risk of near-term inflation is quite pronounced, requiring a continuously tight monetary policy stance to anchor inflation expectations and the disinflation process”.

    In April 2024, inflation declined to 25.0% from 25.8% in March 2024.

    Consequently, the Monetary Policy Committee (MPC) upheld an appropriately stringent monetary policy stance in light of the emerging upward risks to inflation stemming from currency pressures, recent increases in transportation fares, and their potential delayed impact on inflation.

    The Committee noted that its latest projections indicate a somewhat elevated inflation trajectory, attributed to the recent series of cedi depreciations and hikes in transportation fares.

    However, it anticipates the disinflationary trend to persist overall, forecasting headline inflation to fall within the monetary policy consultative range of 13% to 17% by the end of 2024. This projection hinges on maintaining the rigorous monetary policy stance, which includes assertive liquidity management measures.

    GCB Capital concluded that “The decision is consistent with our expectations and the consensus market view as the upside risks to inflation are evident”.

  • It’s better to borrow from loan sharks than from banks in Ghana – Franklin Cudjoe

    It’s better to borrow from loan sharks than from banks in Ghana – Franklin Cudjoe

    The savings culture of most Ghanaians has taken a hit due to ongoing economic challenges such as a depreciating local currency, high interest rates, and surging inflation.

    These challenges are impacting Ghanaians of all age groups, severely limiting investment opportunities due to steep interest rates for borrowing in both the public and private sectors.

    In response to the high interest rates, the Founding President of the policy think-tank, IMANI Africa, has proposed an unconventional solution.

    He suggests that borrowing from loan sharks may be a more viable option than borrowing from banks with excessively high interest rates.

    Franklin Cudjoe, in a post shared on X on May 22, also criticized President Akufo-Addo’s recent remarks about his legacy, suggesting that it falls short of being enviable during his 7-and-a-half-year tenure in office.

    “Borrowing from loan sharks may be more favorable than borrowing from banks in Ghana. 55% interest rates and Nana Addo says he has left an enviable legacy?” Franklin Cudjoe wrote.

    Businesses, particularly in the private sector, have expressed concern over the high interest rates and have constantly asked the government and Central Bank to enact policies aimed at lowering lending interest rates.

    The private sector, which frequently depends on loans for business operations, has been pushed out as a result of this circumstance.

  • Ghana’s inflation falls to 25% in April

    Ghana’s inflation falls to 25% in April

    Inflation for April 2024 has marginally decreased to 25% from the 25.8% recorded in March 2024, indicating a 0.8% slowdown in the inflation rate for the month.

    The Ghana Statistical Service (GSS) attributes the overall drop in inflation to a decrease in food inflation, which reached 26.8%, the lowest in 13 months, along with non-food inflation, which stood at 23.5%.

    In March 2024, Ghana’s consumer inflation rose to a four-month high of 25.8% year-on-year, up from 23.2% the previous month, significantly exceeding the central bank’s target band of 6% to 10%.

    The chief statistician, Samuel Kobina Annim, attributed the sharper rise in inflation to a depreciating currency, which led to higher costs for imported goods. He made these remarks in the capital, Accra, on Wednesday.

    Both food (29.6% vs 27% in February) and non-food product prices (22.6% vs 20%) increased, particularly fuels. The Ghanaian cedi has depreciated by nearly 11% against the US dollar since the beginning of the year due to a stronger dollar, a decrease in cocoa output, and delays in debt restructuring.

    The cedi’s depreciation against the dollar, about 11% so far this year, has made it the fourth worst-performing currency among those tracked by Bloomberg.

  • Ghana on track to reach 8% single-digit inflation rate by 2025 – IMF

    Ghana on track to reach 8% single-digit inflation rate by 2025 – IMF

    The International Monetary Fund (IMF) foresees Ghana ending 2025 with single-digit inflation, estimating it at 8%, in line with the government’s objectives.

    Ghana aims to reduce its end-year inflation from 23% to 15% in 2024, further plummeting to single digits by 2025.

    Although Ghana last achieved single-digit inflation in 2021, subsequent years witnessed a drastic rise, hitting a 22-year high of 54.1% despite a targeted rate of 31.9%.

    However, the IMF’s World Economic Outlook Report at the ongoing IMF/World Bank Spring Meetings paints a promising picture.

    This 8% projection credits the robust measures and progress achieved under the IMF program.

    The Bank of Ghana commits to staying within its 2024 end-year target band of 15%, plus or minus two percent, while expecting the disinflation trend to persist, mitigating underlying inflation risks through stringent monetary policies.

    Furthermore, the IMF predicts a robust 4.4% growth for Ghana in 2025, a marked improvement from the 2.8% forecast for 2024. Nevertheless, it anticipates a -2.2% decline in Ghana’s current account balance, reflecting trade and financial activities.

    Despite this setback, the IMF maintains an optimistic outlook, expecting a substantial economic rebound for Ghana in the coming years.

  • Ghana to end 2025 with 8% inflation rate – IMF projects

    Ghana to end 2025 with 8% inflation rate – IMF projects

    The International Monetary Fund (IMF) is projecting that Ghana will achieve single-digit inflation by the end of 2025, with an end-of-year inflation rate of 8 percent.

    The IMF’s Economic Outlook Report also forecasts an end-of-year inflation rate of 15 percent for 2024, which is consistent with the Bank of Ghana’s inflation projection for the same year, according to a JoyBusiness report.

    The projection is based on the measures implemented by the government under the IMF program and the Bank of Ghana’s commitment to maintaining tight monetary measures to address inflation pressures.

    However, there have been no official reasons provided by the IMF for this projection.

    The Bank of Ghana has set an inflation target of 15 percent “Plus 2 or Minus two” for 2024, meaning inflation could range from 13 percent to 17 percent by the end of the year.

    However, there are concerns about whether the government will meet its 15 percent target as projected in the 2024 Budget, especially with recent increases in the prices of petroleum products and the potential hike in transport fares.

    Despite these concerns, Bank of Ghana Governor Dr. Ernest Addison expects inflation to decrease in the coming months, stating that the Bank has no intention of revising its end-of-year target.

    Ghana last recorded single-digit inflation in July 2021. If the IMF’s projection is accurate, Ghana could return to single-digit inflation by the end of 2025.

    Before April 2020, inflation had remained stable at 7.8 percent for three months. However, the onset of the COVID-19 pandemic led to a spike in inflation, reaching 10.6 percent in April before declining to 9.8 percent in November 2020.

    As of March 2024, Ghana’s inflation stood at 25.8 percent, compared to 45.0 percent in March 2023.

  • 25.8% inflation rate in March won’t disrupt disinflation trend – Analyst

    25.8% inflation rate in March won’t disrupt disinflation trend – Analyst

    Head of Research at GBC Capital, Courage Boti, has described the recent surge in inflation in March as “not surprising” and assures that it does not pose a significant threat to the ongoing trend of disinflation.

    Data from the Ghana Statistical Services (GSS) indicates that consumer inflation soared to 25.8 percent in March 2024, the highest level since November of the previous year.

    This increase, up from 23.2 percent in February 2024, is attributed largely to base drift effects resulting from a sharp price decline in March 2023.

    Despite the uptick, Mr Boti remains unfazed, stating, “It is an increase but I am not surprised. My expectation was 26 percent. Will this be a trend that continues? Admittedly, there are upside risks to inflation, but from April we should begin to see a return to the path of disinflation. The exchange rate, petroleum price and impending transportation price hikes will serve to moderate the pace of disinflation but we expect that without any significant shocks. The general trend is that there will be a continuous decline in inflation”.

    He anticipates a return to the disinflation path from April onwards, citing factors such as exchange rate stability, petroleum price moderation, and anticipated transportation price adjustments.

    Boti projects that inflation will close the year at under 20 percent, attributing this to factors such as adherence to fiscal discipline under the International Monetary Fund (IMF) program and a potential decrease in liquidity and Treasury bill yields due to recent cash reserve requirements by the Bank of Ghana.

    Government Statistician, Professor Samuel Kobbina Annim, while acknowledging the broad-based nature of the inflation surge, particularly in food prices, emphasizes that the increase cannot solely be attributed to imported food.

    Both food and non-food prices experienced a 2.6 percentage point increase in March, indicating widespread inflationary pressures.

    Market analysts had anticipated the rise in inflation, citing ongoing cedi weakness and recent hikes in ex-pump petroleum prices as contributing factors. Despite this, the month-on-month inflation rate declined from 1.6 percent in February to 0.8 percent in March, suggesting potential easing of underlying inflationary pressures.

    GCB Capital maintains its end-2024 inflation forecast at 16.5 percent ±1 percent, expecting the disinflation trend to resume from April 2024.

    “If you look at the food that is imported, out of the 176 items that recorded price changes higher than 25.8 percent, we had 15.9 percent of the food that is imported relative to food that is local, which constituted 23.3 percent.

    “So one cannot argue that imported food is driving the 29.6 percent that we are seeing in March 2024, because we are equally seeing that local food constituted about 41 of the 176 items that recorded price changes higher than 25.8 percent,” he said.

    “What is coming to us for the first time in a while is a division like health that hitherto we would hardly find it as a division that will record a rate of inflation higher than the overall rate of inflation,” Prof. Annim observed.

    “But we are now seeing health coming up as one of the six divisions that are pointing to the higher rate of inflation.”

    “We, however, flag the simmering cedi depreciation amid immediate liquidity concerns and its potential pass through to ex-pump fuel prices in the wake of the lingering crude oil supply concerns due to geopolitics as an immediate upside risk to inflation through the transport channel and general market prices,” said GCB Capital in its March review of the inflation data.

    “What we need to pay emphasis, what we need to pay attention to is year-on-year and month-on-month inflation moving in different directions as we rightly saw for the second time; we are seeing a dip in month-on-month inflation,” Prof. Annim explained.

    “All this would have implications in the coming months in terms of how the month-on-month inflation would feed into the year-on-year inflation.”

    The data revealed that both food and non-food prices saw a 2.6 percentage point increase in March, suggesting broad-based inflationary pressures. Notably, the health sector emerged as one of the six divisions recording inflation rates higher than the national average.

    However, analysts remain cautious about potential fiscal overruns leading up to the 2024 election, which could pose an upside risk to inflation in the latter part of the year.

  • GCB Capital predicts 1.0% inflation decline in April 2024

    GCB Capital predicts 1.0% inflation decline in April 2024


    A Research Group, known as GCB Capital predicts that inflation will go down again in April 2024 after going up in March, which was the highest in four months.

    The group indicates that inflation will drop by 1.0% in April 2024, but it will still be higher than it was in February 2024. They say this drop is mainly because of lower food prices.

    In March 2024, inflation went up to 25.8%, which was a big increase. GCB Capital thinks this increase is temporary, but there are still risks that inflation could go up more, especially because of higher petrol prices and possible increases in transport fares.

    They also say that if the price of Brent crude oil goes up to $100 per barrel, it could make petrol prices go up too, which would increase inflation.

    Additionally, because there is not enough foreign money coming into the country and the local currency is losing value, this could also make inflation go up in the future.

  • March records 2.6% increase in inflation rate

    March records 2.6% increase in inflation rate

    In March 2024, inflation surged to 25.8%, up from February’s 23.2%, representing a 2.6% increase.

    This indicates a 25.8% increase in the general price level compared to March 2023. Non-food inflation rose by 22.6%, while food inflation reached 29.6%.

    Locally produced items saw a 26.6% increase, while imported items rose by 23.8%. The main drivers of this inflation hike were food and non-alcoholic beverages, as well as transport.

    Government spokesperson Prof. Samuel Kobina Annim stated in a press briefing that this increase represents a 2.6 percentage point surge.

  • Ghana’s inflation surges from 23.2% in February to 25.8% in March

    Ghana’s inflation surges from 23.2% in February to 25.8% in March


    In Ghana, inflationary pressures increased from 23.2 percent in February to 25.8 percent in March of this year, as reported by the Ghana Statistical Service.

    The rise is attributed to the depreciation of the cedi, which has elevated the prices of imports, along with escalating costs of fuel products and food items for consumers.

    Stay tuned for further updates…

  • 15 countries with highest inflation rates globally

    15 countries with highest inflation rates globally


    Inflation, a widely discussed economic concept worldwide, refers to the increase in prices over a specific period. It reflects the overall rise in the cost of living or the price escalation of particular goods and services.

    Whether observing the surge in grocery prices or the rise in housing expenses, inflation indicates the extent to which purchasing power diminishes over time, typically measured on an annual basis.

    Government agencies utilize various methods to measure inflation, often relying on consumer price indices (CPIs) to monitor changes in the cost of a predetermined basket of goods and services.

    The CPI basket typically includes items commonly purchased by households, with housing expenses frequently being the largest component.

    By comparing the cost of this basket over time, relative to a base year, analysts calculate the consumer price inflation rate, a widely recognized measure for tracking inflation.

    Core consumer inflation, a subset of this analysis, focuses on persistent inflation trends by excluding government-regulated prices and the more volatile costs of items like food and energy.

    Core inflation provides policymakers with valuable insights into underlying economic trends, free from temporary supply disruptions or seasonal fluctuations.

    For a broader view of inflation, economists turn to indices like the GDP deflator, which encompasses a wider range of economic activities beyond consumer spending.

    High inflation drivers

    High inflation often stems from loose monetary policies, where an excessive increase in the money supply outpaces economic growth, eroding currency value and driving up prices—a principle known as the quantity theory of money.

    Additionally, supply or demand shocks can fuel inflationary pressures.
    Supply disruptions, like natural disasters or spikes in production costs, can trigger “cost-push” inflation, while demand surges or expansionary fiscal and monetary policies may lead to “demand-pull” inflation by straining production capacity.

    Nairametrics has compiled a list of the top 15 countries with the highest inflation rates in the world as at February 2024.

    15. Myanmar Inflation rate: 28.58%

    Myanmar’s inflation rate surged to 28% in the second quarter of 2023, up from 27.5% in the previous quarter. Over the period from 1998 to 2023, the country’s inflation averaged 13.16%. Notably, it hit an all-time high of 54.02% in the fourth quarter of 2002 and reached a record low of -1.09% in the fourth quarter of 2011.

    14. Cuba Inflation rate: 31.34%

    Cuba’s annual inflation rate declined to a 18-month low of 31.34% in December 2023, down from 31.78% in November and 34.13% in the preceding month. The country’s inflation rate averaged 28.14% from 2005 to 2023. Notably, it peaked at 77.3% in December 2021 and hit a record low of 0.8% in December 2008.

    Nigeria Inflation rate: 31.7%

    In February 2024, Nigeria witnessed a surge in its annual inflation rate, reaching a new high not seen since 1996, at 31.7%. This marked an increase from 29.9% recorded in January and surpassed market expectations of 31%.

    The spike was primarily attributed to the removal of oil subsidies and the devaluation of the Nigerian naira. Following the liberalisation of the foreign exchange market in June 2023, the naira depreciated by 69% by mid-February 2024. Consequently, import costs surged, profoundly impacting Nigeria’s import-dependent economy.

    Malawi Inflation rate: 33.5%

    In February 2024, Malawi’s annual inflation rate stood at 33.5%, showing a decrease from the 35% reported in January 2024. Notably, food and non-food inflation rates were recorded at 42% and 22.1%, respectively.

    Egypt Inflation rate: 35.7%

    In February 2024, Egypt’s annual urban inflation rate surged for the first time in five months, reaching 35.7%. This marked a notable increase from January’s 12-month low of 29.8% and exceeded forecasts of 25.1%.

    It represented the highest inflation rate since October, driven by steep increases in food prices by 50.9%, transport by 17.6%, and housing by 10%. The rise followed the government’s decision to hike Cairo metro ticket prices by up to 20% in January, along with increases in internet services by 33% and electricity prices by 26%.

    Iran Inflation rate: 35.8%

    In February 2024, Iran’s point-to-point inflation rate declined to 35.8% from 38.5% in the previous month. This decrease marked the lowest inflation rate since April 2022. Notably, food prices experienced the smallest increase since September 2020, rising by 31.6% compared to 38.9% in January.

    Congo Inflation rate: 46.8%

    The inflation rate in Congo rose to 46.8% in December 2023, up from 45.8% in November of the same year. The average inflation rate in Congo from 1999 to 2023 stood at 23.22%. Congo experienced its highest inflation rate of 511.21% in December 2000 and its lowest of 1.35% in April 2013.

    Sierra Leone Inflation rate: 47.42%

    In January 2024, the inflation rate in Sierra Leone dropped to 47.42% from 52.16% in December 2023. Over the period from 1986 to 2024, the average inflation rate in Sierra Leone was 28.14%. Sierra Leone’s highest inflation rate of 255.56% was recorded in April 1987, while its lowest was -21.76% in January 2000.

    Zimbabwe Inflation rate: 47.6%

    In February 2024, Zimbabwe’s annual inflation rate surged for the fourth consecutive month, reaching 47.6%, the highest level in over a year, up from 34.8% in the previous month. This increase in inflation is primarily attributed to the ongoing depreciation of the Zimbabwean dollar against the US dollar.

    Sudan Inflation rate: 63.3%

    Sudan’s inflation rate declined to 63.3% in February 2023 from 83.6% in January of the same year. The average inflation rate in Sudan from 1971 to 2023 stood at 69.5%, with the highest recorded at 422.78% in July 2021 and the lowest at -1% in December 1979.

    Turkey Inflation rate: 67.07%

    In February 2024, Turkey’s annual inflation rate climbed to 67.07%, up from 64.86% in the preceding month, surpassing market expectations of 65.74%. This marked the highest level since November 2022, primarily fuelled by a significant increase in the minimum wage and government tax adjustments.

    Venezuela Inflation rate: 75.9%

    In February 2024, Venezuela’s inflation rate declined to 75.9% from 107.4% in January of the same year. Venezuela’s inflation rate has averaged 3605.78% since 1973, with a record high of 344509.5% in February 2019 and a record low of 3.22% in February 1973.

    Lebanon Inflation rate: 123%

    In February 2024, Lebanon experienced a decrease in its annual inflation rate, which fell to 123.2% from 177.3% in the previous month. This decline marked the lowest inflation rate since December 2022. The reduction was primarily attributed to softer increases in housing and transport prices, while food prices saw the smallest rise in nearly four years.

    Syria Inflation rate: 140%

    Syria’s inflation rate dropped to 139.6% December 2023 from144.6% in November of the same year. Over the period from 1957 to 2023, the average inflation rate stood at 16.09%. The highest recorded inflation rate was 188.4% in March 2021, while the lowest was -31.05% in September 2014.

    Argentina Inflation rate: 276%

    In February 2024, Argentina’s inflation rate rose to 276.2% from 254.2% in January of the same year. Over the period from 1944 to 2024, the average inflation rate stood at 189.97%. The highest recorded inflation rate was 20262.8% in March 1990, while the lowest was -7% in February 1954.