April Inflation drops marginally to 9.6%, lowest since January 2013

The inflation rate for the month April dropped marginally to 9.6 percent from the 10.4 percent recorded in March 2018. This is the lowest since January 2013.

According to the Ghana Statistical Service, the drop can be attributed to a reduction in the cost of electricity, transportation and other utilities. 

The April Inflation is the percentage change in the Consumer Price Index (CPI) over the twelve-month period, from April 2017 to April 2018. The monthly change rate in April 2018 was 0.9% compared with the 1.1% recorded in March 2018.

Components of Inflation

The year-on-year food inflation rate for April 2018 was 7.4% compared with 7.3% recorded in, March 2018. The year-on-year non-food inflation rate for April 2018 was 10.6% compared with the rate of 11.8% recorded in March 2018.

Coffee, tea and cocoa (10.5%) recorded the highest rate in the food inflation component followed by Fruits (9.8%), Meat and meat products (8.8%), Mineral water, Soft drinks, Fruits and vegetable juices (8.8%), Food products n.e.c(8.5%) and Vegetables (7.9%).

These were the main price drivers in the food inflation component.

The main price drivers in the non-food inflation component were Clothing and footwear (17.2%), Recreation and Culture (13.6%), Furnishing, Household Equipment and Routine Maintenance (13.0%) and Miscellaneous goods and services (12.3%).

Regional Inflation

At the regional level, five regions (Upper West, Brong Ahafo, Western, Northern and Ashanti) recorded inflation rates higher than the national average of 9.6%
Upper West recorded the highest year-on-year inflation rate of 11.7%

Implications

Inflation rates have trended downward largely from highs of 19% recorded in January 2016 down to 13.3% in January 2017 and even further down to 10.3% in January 2018. 

This holds a myriad of potential benefits for economic agents, all other things being equal if this trend continues on a downward trajectory. From a potential increase in your disposable income, which could impact positively on your purchasing power, or from a reduction in the erosion of the value of your savings and investments and even to a favourable business environment which has the potential to attract a range of investors.

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