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Ghana Inflation Shows Signs of Slowdown, But Food Prices Remain a Challenge

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Ghana Inflation tussle has shown a glimmer of hope. The Ghana Statistical Service (GSS) announced a year-on-year inflation rate of 25% in April 2024, a decrease of 0.8% points compared to March. This news comes as a welcome relief for Ghanaians grappling with rising costs.

According to Ghana News Agency, the slowdown in inflation is primarily due to a decline in food inflation, which dropped from 29.6% to 26.8% in April 2024, marking the lowest level in 13 months

However, the news is not entirely positive. Samuel Anim, the Government Statistician at GSS, noted that while food inflation declined, non-food inflation experienced a slight increase.

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“Non-food inflation rose to 23.5% in April from 22.6% in March,” explained Anim. “This highlights the need for a multi-pronged approach to tackle inflation across various sectors.”

This rise in non-food inflation indicates continued pressure on various sectors of the Ghanaian economy. The decline in food inflation (2.8 percentage points) was outweighed by the increase in non-food inflation (0.9 percentage points).

Regional Disparities and Sectoral Variations

The inflation picture across Ghana reveals significant regional variations. The Upper East region bore the brunt of inflation with a staggering rate of 42.5%. Conversely, the Western North and Oti regions enjoyed the lowest inflation rates at 16.8%. This disparity underscores the uneven impact of inflation on different parts of the country.

Furthermore, the GSS data revealed that seven economic divisions recorded inflation rates exceeding the national average. These sectors included:

Alcoholic Beverages, Tobacco, and Narcotics (39.3%)

Restaurants and Accommodation Services (33.9%)

Personal Care, Social Protection, and Miscellaneous Goods and Services (31.9%)

Health (31.2%)

Recreation, Sports and Culture (28.7%)

This data highlights the diverse impact of inflation across different sectors. While food prices showed some improvement, other areas remain under significant pressure.

Food Inflation Breakdown

The decline in overall food inflation doesn’t necessarily translate to a uniform decrease across all food items. The GSS data revealed that 10 out of 15 food sub-classes experienced inflation exceeding the overall food inflation rate. These sub-classes included:

Cocoa Drinks (63.4%)

Tea and Related Products (59.3%)

Vegetables, Tubers, Plantain, Cooking Banana, and Pulses (39.5%)

Coffee and Coffee Substitutes (35.5%)

This breakdown suggests that Ghanaians are still facing significant price hikes for specific food items, particularly essential staples.

Read Also: Food Insecurity Tightens Grip on West and Central Africa

Looking Ahead

While the decline in inflation offers a glimmer of hope, Ghana’s battle is far from over. Addressing the remaining challenges requires a multi-faceted approach. The government must continue implementing policies to stabilize food prices, such as supporting local agriculture and addressing supply chain disruptions.

Furthermore, measures to stimulate economic growth and control non-food inflation are crucial. This might involve fostering a business-friendly environment, managing exchange rates, and implementing targeted interventions in specific sectors experiencing high inflation.

The slowdown in Ghana’s inflation rate provides a much-needed reprieve. However, the fight is not won. Continued vigilance and a comprehensive strategy are necessary to ensure sustained price stability and economic recovery. By addressing regional disparities, tackling sectoral inflation variations, and ensuring essential food items remain affordable, Ghana can navigate towards a more stable economic future.

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