Browsing: Ghana Inflation

The Bank of Ghana is very optimistic that headline inflation would return to its medium term target band of 8±2…

The economist explained that, the stress test will provide information on how to design the needed support for the sector.

This forecast is conditioned on the continued maintenance of tight monetary policy stance and the deployment of tools to contain excess liquidity in the economy.

According to the Finance Minister Ken Ofori Atta, these comprise an agenda to: aggressively mobilize domestic revenue; streamline and rationalise expenditures; boost local productive capacity; promote and diversify exports; protect the poor and vulnerable; expand digital and climate-responsive physical infrastructure; and implement structural and public sector reforms.

Food inflation rose to 43.7%, from 37.8% last month, driven higher by items such as water, milk, eggs and sugar, according to the statistics agency.

This shows the sharp relationship the Cedi depreciation has on the untamed imported inflation. However, the Finance Minister has reiterated government’s commitment to stabilising the Ghana cedi by the end of the year.

Investors may be compelled to sell their cedi holdings, if the MPC committee decides to hold the policy rate at 22 percent.

Financial experts have expressed verified opinion in their response to a question on whether the policy rate could be an effective measure to tame the galloping inflation which currently is around 31.7%.

This means that cost of credit to households and the private sector would rise steadily in the next couple of months.

The ratings released last week, projected annual average inflation of 22% in 2022, slowing to 16% in 2023. Fitch’s projection is better than Ghana government’s revised projected end year inflation of 28.5% as presented by the Finance Minister, Ken Ofori-Atta, during the presentation of the mid-year review budget to parliament, fortnight ago.