Ghana's inflation projected to drop to 16% in June 2025 - Research

The latest IC Research report projects a sharp decline in inflation for June 2025 to 16%.

According to the report, the anticipated 240 basis points drop in year-on-year inflation is attributed to favorable foreign exchange dynamics, lower petroleum prices, and a marked reduction in transport fares.

“The June 2025 CPI data window recorded a 29.5% month-on-month and 35.3% year-on-year appreciation of the Ghanaian cedi against the US dollar. This exerted downward pressure on the prices of imported items, with notable declines in petroleum prices and transport fares. The announced 15.0% reduction in commercial transport fares will continue to restrain transport inflation, with downside spillovers for other items,” the report stated.

Meanwhile, the month-on-month inflation rate is expected to slow to 0.8%, supported by easing food price pressures, particularly in the vegetables and tubers category.

“We estimate that the lower transport cost likely eased the month-on-month pressure observed for vegetables and tubers last month, potentially sustaining food disinflation in June,” the report noted.

The June forecast marks the fifth consecutive month of disinflation, with a cumulative reduction in headline inflation reaching 540 basis points year-to-date.

This contrasts sharply with the marginal 10 basis points decline recorded during the same period in 2024.

The report further reveals that food inflation continued to decline, slowing by 220 basis points to 22.8% in May 2025, driven by a favorable base effect in the heavily weighted CPI for vegetables and tubers, which offset the uptick in fish and other seafood prices.

Inflation for vegetables and tubers fell sharply by 10.3 percentage points to 24.0% year-on-year, although the month-on-month rate surged to 2.4% due to the ongoing planting season.

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