Market News

BY  Christian Akorlie and Emmanuel Bruce

ACCRA, June 4 (Reuters) – Ghana’s consumer inflation slowed in May for the fifth month in a row to its lowest level since February 2022 as inflationary pressures ease across the board in the West African state, the country’s statistics agency said on Wednesday.

Consumer inflation eased to 18.4.% year-on-year in May from 21.2% a month earlier, government statistician Alhassan Iddrisu told a news conference, adding that disinflation was expected to continue in the coming months.

“The inflation trend we are witnessing shows sustained deceleration,” Iddrisu said, adding that food remains a key inflation driver, but the sharper drop in non-food inflation suggests a broad based easing of inflation across the economy.

“This trend underscores the effectiveness of recent monetary and fiscal measures, the recent appreciation of the Cedi against the major international currencies, favourable external price dynamics and positive market sentiment,” he added.

The bellwether producer price inflation reading slowed to 18.5% in April, compared with 24.4% in March.

Last month, the Bank of Ghana held its main interest rate steady at 28.0%, maintaining a tight monetary stance and citing sustained inflationary pressures.

Ghana has struggled to rein in “uncomfortably high” inflation, which remains well above the central bank’s target of 8% with a margin of error of 2 percentage points.

The country is recovering from its worst economic crisis in a generation, marked by disruptions in its cocoa and gold sectors.

Finance Minister Cassiel Ato Forson said in his March budget speech that sharp spending cuts will help bring inflation down to 11.9% by year-end.

(Reporting by Christian Akorlie and Emmanuel Bruce; Writing by Ayen Deng Bior; Editing by Bate Felix and Gareth Jones)