Producer prices increased in January 2024, with the Producer Price Index (PPI) surging to 17.4 percent from 16.6 last December, indicating substantial inflationary pressures on domestic producers.
The latest figures, released by the Ghana Statistical Service (GSS), reveal a notable uptick in prices compared to the same period last year.
The PPI serves as a crucial gauge of inflation at the producer level, measuring the average change in prices received by domestic producers for their goods and services over time.
In this case, the index reference period spans from March 2020 to February 2021, with a base value set at 100, allowing for the tracking of price fluctuations relative to this benchmark.
According to the report, the PPI for January 2024 marks a 0.8 percentage point increase from December 2023, where the PPI stood at 16.6 percent.
An analysis of sectoral performance sheds light on the drivers behind the overall PPI surge. The industry sector experienced a notable uptick, with its PPI climbing from 16.2 percent in December 2023 to 17.2 percent in January 2024.
However, despite remaining high, there was a slight moderation in the construction sector’s inflation rate, dropping from 46 percent in December 2023 to 40.2 percent in January 2024. Similarly, the service sector witnessed a decline in inflation, with the rate dipping from 17.6 percent in December 2023 to 16.9 percent in January 2024.
Further disaggregation of the data reveals that certain economic activities contributed more significantly to the overall inflationary pressures. Electricity and gas, construction, mining and quarrying, and accommodation and food services recorded inflation rates above the national average. Conversely, the manufacturing sector reported the lowest inflation rate at 9.7 percent in January 2024.
The month-on-month change in the PPI between December 2023 and January 2024 stood at 1.7 percent, indicating a spike in prices within a short period.
It is important to note that while the PPI figures for January 2024 are provisional, and subject to revision as additional data becomes available, they underscore the growing inflationary challenges faced by producers.
Some analysts have expressed concern over the acceleration in producer prices, highlighting potential implications for consumer prices and overall economic stability. They emphasized the need for proactive measures to mitigate inflationary pressures and maintain macroeconomic equilibrium.
Government officials, particularly the Bank of Ghana, have acknowledged the significance of addressing inflationary concerns, pledging to closely monitor price dynamics and implement appropriate policies to ensure sustainable economic growth and stability.
Efforts to enhance productivity, streamline regulatory frameworks, and promote investment in key sectors are among the strategies proposed to mitigate inflationary pressures and support economic resilience.