Composite Index of Economic Activity down by 8.9%
Real Composite Index of Economic Activity (CIEA) as measured by the Bank of Ghana for the month of September 2021 recorded an annual growth rate of 11.1 percent compared to the 10.7 percent recorded in the corresponding period of 2020.
The recorded 11.1 percent CIEA for the month of September is indicative of a 0.4 percentage points increment for the period between September 2020 and 2021.
However, compared to the 20.0 percent recorded CIEA for the month of July – quarter on quarter basis – the recorded 11.1 percent CIEA for the month of September represents a contraction of some 8.9 percentage points.
The decrease in the CIEA can be attributed to a slow down in economic activities within the quarter -Q3- as evidenced by a 3.1% GDP growth in quarter 2 from a 3.9% GDP growth in quarter 1 [although the GSS is yet to announce the GDP growth rate for Q3] on the account of a decline in industrial production activities, domestic consumption, import activities, construction activities and air-passenger arrivals.
It is also likely to be the result of mixed consumer and business sentiments with regard to economic activities in the country.
The BoG in its September MPC press briefing noted there was a weakening in business sentiments stemming from supply disruptions.
“High-frequency economic indicators point to continued recovery in economic activity, even though below pre-pandemic levels. Although consumer confidence picked up, weakening business sentiments, stemming from supply disruptions, is adversely impacting input costs, driving down short-term company prospects,” stated the Governor.
“While credit to the private sector saw a marginal pickup, the trends remain below expectations largely on account of pandemic-related risk aversion. The COVID-19 related macro-prudential measures, put in place by the Bank of Ghana, will be maintained for the time being to support full recovery in economic activity,” he added.
The BoG’s CIEA measures changes in the level of economic activities and in the pandemic era, the economy’s recovery from the negative impacts of the Covid.
