Producer Price Inflation hits 23.3%

The country’s year-on-year Producer Price Inflation (PPI) increased by 23.3%, representing an increase in producer price inflation by 8.0% points, relative to the 15.3% rate recorded in December 2013.

Government Statistician, Dr Philomena Nyarko, who disclosed this at a news conference in Accra added that the month-on-month change in producer prices between December 2013 and January 2014 was 7.2 %.

Dr. Nyarko said in January 2014, the PPI in the mining quarrying sub-sector increased by 7.4 percentage points over the December 2013 rate of -13.2%, to record -5.8%.

She said the manufacturing sector, which constituted more than two-thirds of total industry, increased by 6.8 percentage points to record 24.2% while the rate for the utilities sub-sector rose by 14.3 percentage points relative to the December 2013 rate of 41.0% to record 55.3% in January 2014.

She said during the twelve-month period from January 2013 to January 2014, the highest year-on-year inflation of 23.3% for all industry was recorded in January 2014, and the lowest of 4.7% was recorded in August 2013.

Furthermore, she said, the PPI fluctuated from January 2013 until March 2013 when it declined continuously over a five-month period to record the lowest rate of 4.7% in August 2013, inching up to record 5.8% in September 2013, increasing sharply to 11.6% in October 2013 and increasing further to 13.0 in November 2013, to 15.3% in December 2013 and to 23.3% in January 2014.

Dr Nyarko said in the month of January 2014, seven out of the sixteen major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 24.2% while the manufacture of machinery and equipment recorded the highest inflation rate of 76.0%, with producer prices in the manufacture of electrical machinery and apparatus recording the lowest inflation rate of-0.8% over the one-year period.

In the petroleum sub-sector, she said, the PPI recorded a negative inflation of 1.3% in January 2013, rising in March 2013 and increasing consistently to record 33.6% in September 2013, decreasing in October 2013 to record a rate of 30.0% and subsequently rising sharply to record 48.3% in January 2014 due to increases in petroleum prices.

According to Dr Bediako, the monthly changes in the PPI indicated that the utilities recorded a monthly inflation of 10.2% while mining and quarrying recorded 9.4%, with the manufacturing sub-sector recording the lowest monthly rate of 5.9%.

The PPI measures the average change over time in the prices received by domestic producers for the production of goods and services.

The PPI for Ghana reports the producer price indices with reference to September 2006, the base period.

Credit: ISD