Ghana’s consumer inflation slowed for the 13th consecutive month to 3.8% year-on-year in January from 5.4% in December, signalling price stability in the cocoa-producing West African nation, its statistics service said on Wednesday.
The drop of 1.6 percentage points was driven by the decline in food inflation, which fell to 3.9%, Government Statistician Alhassan Iddrisu told a news conference.
It is the lowest inflation rate recorded since Ghana’s Consumer Price Index was rebased in 2021, Iddrisu said.
“The sustained decline signals that Ghana is firmly on a path towards price stability,” he added.
The decline marks a continuation of the sharp downward trajectory that has seen inflation drop from the record rate of 54.1% in December 2022.
The further decline in inflation provides the Bank of Ghana with more room to keep easing monetary policy, after a series of rate cuts that have reduced its main lending rate by a cumulative 12.5 percentage points since last July.
“An exceptionally low inflation print that leaves the door to further easing in Ghana wide open,” said Razia Khan, chief economist for Africa and the Middle East at Standard Chartered Bank.
Inflation is now below the Bank of Ghana’s 8% target, with a 2% tolerance range, but Governor Johnson Asiama said after the last monetary policy committee meeting in January that it is too soon for the central bank to reassess the target.
Ghana is emerging from its most severe economic crisis in decades, and it is expected to complete a three-year IMF support programme in August.
