Inflation drops to 12.8%
Inflation rate for the month of March hit 12.8 per cent compared to the 13.2 per cent recorded in February 2017. This means that the general price level of goods and services went up by 1.3 per cent between February 2017 and March 2017, an indication that prices of items could be sold at a lower rate.
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The drop is the third consecutive time in 2017 that Ghana’s inflation rate has dipped, the lowest since December 2013.
The Consumer Price Index (CPI) measures the change over time in the general price level of goods and services that households acquire for the purpose of consumption, with reference to the price level in 2012, the base year, which has an index of 100.
Factors
The acting Government Statistician, Mr Baa Wadieh, said at a news conference in Accra yesterday that aside from the high exchange rate and price changes, the combined effect of the declining food and non-food components of inflation helped to achieve the low rate.
“Due to the removal of subsidies from petroleum products, electricity and water, the prices of these items went up in 2016, which led to the rise in inflation. After the major deregulation exercise in early 2016, there has not been any major adjustments in prices,” he said.
He explained that; “Most of these increases have run almost a 12-month cycle and their effects are easing out and that is what we have been witnessing in the inflation rate particularly this year.”
The year-on-year non-food inflation rate for March 2017 was 15.6 per cent compared to the 16.4 per cent recorded in February 2017.
Price drivers
In March 2017, the year-on-year inflation rate for imported items (15.5 per cent) was 3.8 percentage points higher than that of locally produced items (11.7 per cent).
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The price drivers for the food inflation rate were fish and sea food (14.7 per cent) and meat and meat products (10.9 per cent).
The main price drivers for the non-food inflation rate were recreation and culture (23.7 per cent), furnishings, household equipment and routine maintenance (23.5 per cent), clothing and footwear (18.2 per cent), education (17.3 per cent), miscellaneous goods and services (16.7 per cent) and health (15.8 per cent).
Regional differences
At the regional level, Mr Wadieh stated that four regions (Greater Accra, Upper West, Brong Ahafo and Ashanti) recorded inflation rates higher than the national average, while Northern Region recorded the same inflation rate as the national average of 12.8 per cent.
The Greater Accra and Upper West regions recorded the highest year-on-year inflation rate of 13.7 per cent, followed by the Brong Ahafo Region with 13.4 per cent while the Volta Region recorded the lowest (10.7 per cent).