The latest figures released by the Government Statistician, Professor Samuel Kobina Annim, show a notable surge in Ghana’s inflation rate for the month of March 2024.
The inflation rate has escalated to 25.8%, marking a significant increase from the 23.2% recorded in February of the same year, signifying a 2.6 percentage point surge.
This increase is particularly driven by a sharp rise in food prices, with the food inflation rate climbing from 27.0% in February to 29.6% in March. Non-food inflation also saw an uptick, reaching 22.6% in March.
Professor Annim clarified that food inflation stood at 29.6%, while non-food inflation was at 22.6%. He noted that both food and non-food categories experienced a 2.6% rise in inflation rates from February to March 2024.
In an interview with RGGNEWS, Dr. George Domfeh, a development economist with the University of Ghana, provided insights into the factors contributing to this inflationary trend.
He pointed out that the first quarter of the year typically witnesses a weakening of the cedi against major trading currencies due to capital flight associated with profit repatriation by multinational companies operating in Ghana.
This leads to a reduction in the supply of dollars, consequently impacting inflation rates.
Dr. Bomfeh highlighted another contributing factor, the global increase in crude oil prices. He noted that the depreciation of the cedi against major currencies has also played a significant role in driving up inflation.
Looking ahead, Dr. Bomfeh predicted that by the end of the year, the inflation rate is likely to stabilize around 14 to 15%, provided global market conditions remain stable.
He emphasized that as profit repatriation activities subside after the first quarter, the cedi is expected to regain stability, thereby exerting less inflationary pressure.
