Inflation Rate Stays at 7.8% in February

The year-on-year inflation rate remained unchanged at 7.8% in February in line with expectations as reduced petroleum prices at the pump coupled with a Cedi appreciation eased tension on consumer prices. The current rate represents a 140 basis point (bps) drop from a reported rate of 9.2% over the same period last year.

According to data released by the Ghana Statistical Service (GSS), inflation on imported goods picked-up marginally from 5.8% in January to 5.9% in the current month despite gains made by the local currency. However, inflation on local goods declined from 8.7% to 8.6% over the same period. The GSS maintains that food and non-alcoholic beverages remain the major driver of consumer prices in Ghana.

The Food and non-alcoholic beverages group recorded a year-on-year inflation rate of 7.9%, down from 7.8% recorded in the first month of the year. Eight subgroup items including ‘cocoa drinks’ at 14.1% recorded rates above the group’s inflation rate while seven other subgroup items including ‘tea and plant products’ at 1.2% recorded rates below the group’s rate.

The inflation rate for the Non-food and alcoholic beverages category recorded its second consecutive decline in February. It dipped from 7.9% in January to 7.7% in February. ‘Alcoholic beverages & other narcotics’ at 11.6% recorded rates above the group’s inflation rate. ‘Insurance and financial services’ at 0.4% were among eight others that recorded rates below the group’s inflation figure.

At the regional level, the Greater Accra region recorded the highest inflation with a rate of 9.7% while the Upper West region recorded the lowest at a rate of 5.0%.

In the wake of the emergence of the external risk of the spreading coronavirus, the Monetary Policy Committee of the BoG will be expected to continue to maintain its cautious stance at its next sitting later in the month.