Ghana’s economy struggles as confidence indices remain below 100
Bank of Ghana data reveals declining confidence among both consumers and businesses in the country’s economy. The Consumer Confidence Index and the Business Confidence Index have consistently remained below the 100 mark since the start of 2021.
The average Consumer Confidence Index has been 86.13 and the average Business Confidence Index has been 88.19 over this period.
In October 2022, the indices dropped to their lowest ever levels, with the Consumer Confidence Index at 73.9 and the Business Confidence Index at 72.6.
However, the indices improved in December 2022, with the Consumer Confidence Index rising to 79.2 and the Business Confidence Index at 75.7, attributed to a reduction in ex-pump petroleum prices and transportation fares, and an appreciation of the local currency.
The Consumer Confidence Index measures the level of optimism or pessimism among consumers regarding their financial situation, with an indicator above 100 signaling a positive outlook and a tendency to spend more.
Meanwhile, the Business Confidence Index provides insight into future economic developments based on surveys of production, orders, and stocks in the industry sector.
Ghana’s Real Composite Index of Economic Activity (CIEA) shows an all-time low of -6.2% in November 2022, indicating a worsening outlook on the country’s domestic economic activity.
This follows a decline from 39.4% in April 2021 to -6.2% by November 2022, potentially due to high fuel prices, high inflation, and excessive depreciation of the Ghanaian cedi.
