Inflation drops to 16.92 per cent
Inflation in the country has reduced from 18.04 per cent to 16.92 per cent as a result of a marginal reduction in the prices of food and non-food items last month.
The drop in inflation, which measures the average change of price levels for the month, represents a decrease of 1.45 percentage points on the monthly indices.
Speaking at the monthly press briefing on the Consumer Price Index (CPI), the Government Statistician, Dr Grace Bediako, attributed the decline to price decreases in both the food and the non-food components of the CPI.
She expressed optimism that inflation would ease further down to meet the end-of-year projection of the Bank of Ghana (BoG).
The BoG has projected an end-of-year inflation target of between 14.5 and 17.5 per cent and the current 16.92 per cent is, therefore, within the range of the forecast.
In November 2009, inflation rate for the non food group was 20.05 per cent, as against 12.38 per cent for the food group, she said.
According to Dr Bediako, corresponding figures for October 2009 were 21.15 per cent for non-food and 13.53 per cent for the food component of the CPI.
However, the Government Statistician indicated that the monthly rate of inflation recorded in November was 0.75 per cent, which was higher than the figure for October, which was negative 0.95 per cent.
She said inflation had been relatively high in 2009, averaging 19.60 per cent, compared to 2008, when it averaged 16.46 per cent.
She, however, was optimistic that inflation would ease further down.
The Minister of Finance and Economic Planning, Dr K wabena Duffour, said, "The macroeconomic and fiscal stabilisation measures implemented by the government have established sound economic fundamentals in the country."
That, he said, had led to a significant reduction in the fiscal and external deficits and sharply built up the country's gross foreign reserves.
"Together, these have also had a significant positive impact on the cedi," he stated.
The minister said the depreciation of the cedi observed in the first half of the year had been reversed in the second half of the year.
The rate of depreciation of the cedi to the dollar at the interbank market declined sharply from 5.4 per cent in January this year to 0.9 per cent in July.
The cedi has since appreciated in each month against the dollar - 1.7 per cent in August; 0.7 per cent in September and 0.6 per cent in November.
"The appreciation of the cedi has contributed significantly in lowering inflation, causing the CPI to drop in four conservative months," Dr Duffour stated.
The minister said the expectation was that inflation would further decline by the end of the year, as the appreciation of the cedi was expected to keep imported inflation low. .
"For the first time in many years, therefore, Ghanaians will experience stable prices and an appreciating cedi in a Christmas period, a clear demonstration of 'building a better Ghana' for all," Dr Duffuor added.
Meanwhile, the Ministry of Finance, in a statement, has attributed the drop in inflation to the macroeconomic and fiscal stabilisation measures of the government, supported by a good food harvest.
"The macroeconomic and fiscal stabilisation measures implemented by the government have established sound economic fundamentals in the country, it said.
Source: Daily Graphic
