Inflation drops to 35.2% in October — Rate 3rd lowest in 13 months
The general price levels, inflation, in the country trended downward in the month of October, to 35.2 per cent, the third lowest in the last 13 months.
In what is expected to bring some level of relief to Ghanaians, the rate is 2.9 percentage points lower than the 38.1 per cent rate recorded in the previous month.
Food and non-alcoholic beverages remain the major drivers with a share of more than half (55.1%), followed by transport (7.6%), housing, water, electricity, gas and other fuels (7.5%) and clothing and footwear (7.1%) in the period under review.
Two items (Fresh Tomatoes([1.2) and smoked herrings (2.9) with significant weights (> one) remain in the list of the 20 items with the highest year-on-year changes in price.
The economy has been heavily hit by many factors including high inflation which reached a 22-year high of 54.1 per cent in December 2022.
In its quest to address the problem, Bank of Ghana has been consistently increasing the monetary policy rate as a measure to slow down the inflation rate.
It is not clear whether the tight monetary policy rate at 30 per cent is the cause of the drop in inflation but analysts await the next Monetary Policy Committee (MPC) report to ascertain whether the new inflationary trend will influence a drop in the policy rate to impact the high interest rates in the country.
The drop in inflation at this time of the year is also particularly exciting as the phenomenon is largely driven by a drop in food inflation with weeks to the celebration of the Yuletide where demand for food is expected to be heavy.
Government Statistician, Professor Samuel Kobina Annim, in announcing the inflation rate for October at a news conference in Accra yesterday said “Year-on-Year inflation in October 2023 further slows down for the third time in a row, and month-on-month inflation slows down from 1.9 per cent to 0.6 per cent.”
Year-on-Year (YoY) food inflation reduced by 4.6 percentage points between September 2023 and October 2023 and non-food inflation reduced by 1.6 percentage points.
Month-on-month food (0.1%) was 0.9 percentage points lower than non-food inflation (1.0%) in October 2023.
Inflation for locally imported items (34.4%) was 2.6 percentage points lower than imported items (37.0%).
Both food and non-food inflation dropped for the third consecutive month. The food inflation (44.8%) is the second lowest in the last 13 months while non-food inflation (27.7%) is the lowest in the last 13 months.
Steeper declines are observed for food inflation than non-food inflation.
Meanwhile, four divisions recorded inflation rates higher than the national average of 35.2 per cent.
This was led by alcoholic beverage, tobacco and narcotics (45.7%), personal care, social protection and miscellaneous goods and services (45.0%); food and non-alcoholic beverages (44.8%) and furnishings, household equipment and routine household (40.9%).
Insurance and financial services (5.5%) recorded the lowest rate of inflation.
Restaurants and Accommodation Services (3.2%) recorded the highest month-on-month rate of inflation and food inflation (0.1%), the lowest.
North East Region (47.5%) recorded the highest rate of inflation, closely followed by the Eastern (46.6%) and Western (46.0%) regions.
Eight regions (North East 47.5%), Eastern (46.6%), Western (46.0%), Volta (42.5%), Northern (40.6%), Bono (39.7%), Western North (37.8%), and Bono East (36.8%) recorded rates higher than the national average (35.2%)
Eastern Region recorded the highest food inflation (65.3%) while Western Region had the highest for non-food inflation (43.9%).
In North East Region, four divisions (Alcoholic Beverages, Tobacco and Narcotics (69.5%); Food and Non-Alcoholic Beverages (61.8%) and Personal Care, Social Protection and Miscellaneous Goods (48.8%) recorded rates higher than the regional average (47.5%).
Seven regions (Oti, Bono, Eastern, Western North, Central, Savannah and Greater Accra) record a slowdown in their rates of inflation between October 2022 and 2023.