The International Monetary Fund IMF in its October World Economic Outlook has predicted an end-year inflation rate of 11.6 per cent for Ghana.
The Fund’s forecast is higher than Bank of Ghana’s inflation medium target band of 8+\-2 per cent.
Despite inflation moving above its medium target band by end-2020, the IMF further projected that inflation will return to single digits, specifically 8.7 per cent in 2021.
Ghana’s inflation rate for September 2020 was 10.4 per cent, falling by 0.1 per cent from a previous rate of 10.5 per cent in August 2020.
The Ghana Statistical Service cited some reduction in prices of food stuffs as the driver of the slight fall in the inflation rate in the month of September.
Inflation is a very important economic indicator because of its effect on interest rates and cost of borrowing.
For instance, the Bank of Ghana’s inflation targeting framework’s objective is to maintain stability in the general level of prices.
The IMF has said inflation is expected to remain low this year globally.
In the emerging market and developing economy, inflation is projected at 5 per cent this year, below the historical average for the group.