Inflation Pushes Further Up to a Six-Month High

In line with expectations, the consumer price index nudged up for the third consecutive time in November as increased consumer spending as the wraps up culminated in upward price pressures. The inflation rate accordingly rose to its highest since May 2024, inching up from 22.1% registered in October to print at 23.0% in November. The pick-up in the latest inflation reading came on the back of increases in the prices of imported items following a resurgence of pressures on the local currency in the last quarter. This further intensified pressures on the food basket pushing the food inflation to its highest in seven months.

The month-on-month inflation reading similarly recorded an increase, rising from a low of 0.9% in October to print at 2.6% in November. Data released by the Ghana Statistical Service revealed that significant increases in the prices of Cereals, Housing, utility & other fuels, and Fruits & nuts supported the rise in the month-on-month inflation reading.

Food inflation extended its dominance over non-food inflation for the third consecutive time in November as it rose from 22.8% in October to 25.9%. Month-on-month food inflation soared from 0.3% in the previous month to 3.8% in November. This was led by Cereal products, Fruits & nuts, and Oils & fats with inflation rates of 7.1%, 5.7%, and 5.4% (m-o-m) respectively.

Non-food inflation took a surprising turn as it recorded a disinflation, lowering from 21.5% in October to print at 20.7% in November. Month-on-month non-food inflation remained unchanged at 1.4% as some key items in this category recorded decreases.

Across the regions, the inflation rate hovered between 18.7% in the Eastern region and 44.9% in the Upper East region. Inflation on both local items and imported items saw increases with inflation on local items rising from 24.6% in the previous month to 25.4% in November, whilst that on imported items rose to 17.6% in November after recording a decline in October.

The last sitting of the Monetary Policy Committee for 2024 saw the central bank take a precautionary stance as it adopted a wait-and-see approach, thus stalling the policy rate at the prevailing 27.0%. The committee noted that the horizon for inflation to get back within the target band of 8.0% ± 2.0% has slightly shifted forward to the last quarter of 2025 from the initial forecast of quarter 3 2025 whilst in the near-term, strengthening of the Cedi will be expected to augur well for future price developments.