Inflation rises by 100bps to 42.2% in May
The Ghana Statistical Service has reported a rise in the year-on-year inflation rate for May 2023, increasing to 42.2% from the previous month’s rate of 41.2%. The upward trend was primarily driven by inflation in the non-food category.
Month-on-month inflation between April 2023 and May 2023 was 4.8%.
Inflation reached a more than two-decade high of 54.1% in December, but it declined for fourth consecutive months up to April 2023.
Food inflation witnessed a sharp rise to 51.8% in May from 48.7% in April and non-food price growth decelerated to 34.6% from 35.4% within the same period under review.
The announcement was made by Prof. Samuel Kobina Annim, the Government Statistician, during a press conference held in Kumasi. The inflation figures indicate a continued challenge for the country’s economy and highlight the need for measures to curb rising prices.
The increase in the non-food category suggests that sectors such as housing, education, and healthcare may have experienced significant price hikes. This could potentially impact the cost of living for Ghanaians and put pressure on household budgets.
On regional rates of inflation, the Ashanti region recorded the lowest national inflation of 31 percent while the Western North region recorded the highest with 62.5 percent.
The government and policymakers will likely need to closely monitor the inflationary pressures and take appropriate measures to manage the situation. Addressing the root causes of inflation, such as supply chain disruptions, rising production costs, and increased demand, will be crucial in stabilizing prices and ensuring sustainable economic growth.
The rise in inflation comes at a time when Ghana, like many other countries, is still dealing with the aftermath of the global COVID-19 pandemic. The pandemic has caused disruptions across various sectors, leading to supply chain challenges, reduced economic activity, and increased costs for businesses and consumers.
Efforts to mitigate inflationary pressures will require a comprehensive approach that focuses on both short-term measures, such as monetary policy adjustments, and long-term strategies aimed at improving productivity, enhancing the business environment, and promoting investment in critical sectors of the economy.
As Ghana strives to navigate these challenges, close attention will be paid to the country’s inflation trajectory in the coming months. The government, in collaboration with relevant stakeholders, will need to implement effective policies to address the underlying causes of inflation and work towards achieving price stability and sustainable economic development.
