Inflation to average 33.4% in 2023
Research firm, Fitch Solutions, is forecasting a disinflationary process for Ghana in 2023.
Per the firm’s assessment of the Ghanaian economy, inflation will average 33.4% this year.
Inflation, it asserts, will decline gradually in 2023 as tax hikes – including an increase in the Value-Added Tax to 15.0% – will exert upward pressure on consumer prices.
“A decline in real incomes will weaken consumer activity in 2023. We anticipate a disinflationary trend in 2023 – with price growth averaging 33.4%,” it stated.
Fitch Solutions had earlier predicted an average inflation of about 18.7% in 2023. Inflation however ended 2022 at 54.1%.
The research firm continued that other fiscal consolidation measures, such as the introduction of an income tax bracket of 35.0% will further squeeze household finances in 2023.
It also forecast private consumption growth to also slow to 2.4% in 2023, from an estimated 2.8% in 2022.
Ghana’s inflation ended 2022 at 54.1%, data from the Ghana Statistical Service (GSS) revealed.
Despite a strong improvement in the value of the cedi and a reduction in the prices of petroleum products, the rate of inflation still went up in December 2022.
This was due to steep increases in food, transport and housing costs.
