Ghana’s economic turnaround gained momentum in August as inflation fell to its lowest level in nearly four years, reaching 11.5% compared to 12.1% the previous month. This marks the eighth consecutive month of declining inflation, with monthly prices actually falling 1.3%, according to Government Statistician Alhassan Iddrisu speaking in Accra.
The West African nation’s position as the world’s second-largest cocoa producer and Africa’s top gold producer has proven advantageous amid rising commodity prices. These favorable market conditions have driven a remarkable 23% appreciation in the cedi against the dollar this year, significantly tempering inflationary pressures across the economy.
The sustained disinflationary trend strongly supports expectations for another interest rate cut at the Bank of Ghana’s September 17 monetary policy meeting. Following July’s substantial 300 basis-point reduction to 25%, Governor Johnson Asiama previously indicated the committee would “continue to assess incoming data and likely reduce the policy rate further should the disinflation trend continue.”
Food inflation, a critical component affecting household budgets, decelerated to 14.8% in August from 15.1% previously. Non-food price growth also eased significantly to 8.7% from 9.5%, demonstrating broad-based price moderation across Ghana’s economy as the central bank targets its 6%-10% inflation range by year-end.
