July Inflation Slips By 0.8%

For the fourth consecutive time from April this year headline inflation continue to enjoy downward movements. Latest figures released by the Ghana Statistical Services (GSS) show the annual rate of inflation dipping by 0.8 percent to end July at 14.9 percent.

The current reduction from the 15.7 percent recorded in June was however least expected as a marginal rise in inflation was the forecast of many analysts owing to the low rainfall experienced in the first half of the year. The national consumer price index for July was 414.51 compared to that of July 2004?s figures of 360.89.

Headline inflation opened the year at 11.6 percent and rose to 16.6 percent in April. However, prudent management of the economy led to a disinflation process after April when it eased by 0.1 percent to 16.6 percent and further down by 16.3 percent in May 2005.

By mid-year (June 2005), inflation was 15.7 percent receiving its impetus from the improved food situation and a resilient macro economy. This development many analysts believe triggered yet another decrease this month bringing the inflation figure down to 14.9 percent.

These developments coupled with the trickling in of donor grants from development partners as well as the picking up of economic activities in the building and construction sector and the service sector is expected to provide the needed impetus for achieving the end of year inflation 13.5 percent.

Economic analysts have already welcomed Government?s move to initiate measures to rehabilitate and modernise irrigation infrastructure in the country. This initiative they say would increase food production and ensure stable food prices.