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Producer Price Inflation for December 2020 up 7%

BY: Emmanuel Bruce
The Government Statistician, Professor Samuel Annim
The Government Statistician, Professor Samuel Annim

The Producer Price Inflation rate for December 2020 increased by 7.0 per cent year-on-year.

This rate represents a 1.1 percentage point decrease in producer inflation relative to the rate recorded in November 2020 (8.1 per cent).

The month-on-month change in producer price index between November 2020 and December 2020 was 0.6 per cent.

The Producer Price Index (PPI) measures the average change over time in the prices received by domestic producers for the production of their goods and services. The PPI for Ghana reports the producer price indices with reference to September 2006 as the base period.

The mining and quarrying sub-sector recorded the highest year-on-year producer price inflation rate of 31.5 per cent, followed by the manufacturing subsector with 3.8 per cent.

The PPI in the mining and quarrying sub-sector decreased by 2.5 percentage points over the November 2020 rate of 34.0 per cent to record 31.5 per cent in December 2020, with that of manufacturing, which constitutes more than two-thirds of the total industry, decreasing by 1.0 percentage points to record 3.8 per cent

The utility sub-sector recorded the lowest year-on-year producer inflation rate of 0.2 per cent. It decreased marginally by 0.1 percentage points over the November 2020 rate of 0.3 per cent to record 0.2 per cent.

For the monthly changes, the mining and quarrying sub-sector recorded the highest inflation rate of 0.9 per cent, followed by manufacturing sub-sectors with 0.6 per cent. The Utility sub-sector recorded no change in inflation rate.

Manufacturing sector

In December 2020, nine out of the sixteen major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 3.8 per cent.

Manufacture of motor vehicles, trailers and semi-trailers recorded the highest inflation rate of 34.5 per cent, while the manufacture of non-alcoholic bevearages, refined petroleum products, and nuclear fuel recorded the least inflation rate of negative 4.0 per cent.

Petroleum Price Index

The producer inflation rate in the petroleum subsector was 8.2 per cent in December 2019.

The rate increased to record 20.6 per cent in January 2020 but declined consistently to record -15.4 per cent in May 2020.

However, the rate increased continuously to record -0.3 per cent in September 2020 and declined to record negative 5.0 per cent in November 2020.

The rate increased to record negative 4.0 per cent in December 2020.

PPI trends

In December 2019, the producer price inflation rate for all industry was 13.0 per cent. The rate increased to 14.5 per cent in January 2020 but declined to 6.8 per cent in March 2020.

After that, the rate increased continuously to record 9.5 per cent in June 2020 but declined to 9.0 per cent in August 2020.

The rate increased to record 9.7 per cent in September 2020 but declined continuously to record 7.0 per cent in December 2020.