Ghana’s factory gate inflation has declined for the second consecutive month, bringing some relief to a country struggling with high inflation rates.
According to the Ghana Statistical Service, year-on-year inflation at factory gate prices for all goods and services fell to 43.7% in March 2023, down from 50.8% recorded in February 2023. This is in line with the Consumer Price Inflation, which also fell to 45.0% in March 2023.
The monthly producer inflation rate was 1.7%, indicating a slight increase from the previous month. Although this may not appear significant, it is a positive sign that inflation may be beginning to stabilize, offering a glimmer of hope for consumers and businesses alike.
The decline in inflation at the factory gate is encouraging, but it’s important to note that the country’s inflation rate remains high, making it challenging for households and businesses to make ends meet. The high inflation rate can be attributed to several factors, including the depreciation of the local currency, rising energy costs, and supply chain disruptions caused by the pandemic.
Among the sectors, Industry recorded the highest Producer Price Inflation (PPI) of 43.3% in March 2023, compared to 57.9% in March 2022. This was followed by Construction with PPI of 18.8% and Services with PPI of 18%. The sub-sector with the highest year-on-year PPI was Transportation and Storage at 59.3%. Other sub-sectors that recorded PPI higher than the average producer inflation were Electricity and Gas (57.5%), Accommodation and Food Services (47.0%), and Manufacturing (46%).
The decline in inflation at the factory gate is expected to have a positive impact on businesses and consumers. For businesses, the lower inflation rate could help reduce input costs, which could boost productivity and profitability. Meanwhile, consumers could benefit from lower prices, which could help reduce the cost of living.
Norvareports