The Director of Communications of the New Patriotic Party (NPP), Richard Ahiagbah, has called for support for the government as the inflation rate drops.
He described the drop in the rate as impressive.
“Inflation is down from 40.1% in August, to 38.1% in September, an impressive 2% percentage points. Down, down we go. Let’s support the government to bring back the economy stronger and better,” Mr Ahiagbah tweeted.
Inflation is down from 40.1% in August, to 38.1% in September, an impressive 2% percentage points. Down, down we go. Let’s support the government to bring back the economy stronger and better.#Ghana #NPPCOMMS #TV3NewDay #CitiNewsroom #JoyNews #3NewsGH @asaaseradio995…
— Richard Ahiagbah (@RAahiagbah) October 11, 2023
The inflation rate in Ghana dropped to 38.1% in September 2023, the Government Statistician, Professor Samuel Kobina Annim, announced on Wednesday, October 11.
This is down from the 40.1% recorded in August. The downward trend is according to the decrease in the prices of food and non-food items, Prof Annim said at a press conference in Accra.
Food inflation fell from 51.9% in August to 49.4% in September, while non-food inflation fell from 30.9% to 29.3%, Prof Annim said.
Earlier, analysts had expressed optimism of economic recovery.
For instance, the Director of the Institute of Statistical, Social and Economic Research (ISSER) at the University of Ghana, Professor Peter Quartey said that although the inflation rate was still high, it is coming down.
Professor Quartey was commenting on the confirmation by the International Monetary Fund (IMF) that Ghana’s economy is experiencing a rapid turnaround better than anticipated.
The Fund said macro-economic stability is being experienced while international reserves are witnessing a steady increase.
This was disclosed by the Fund’s Chief of Mission to Ghana, Stéphane Roudet, at a joint press conference with the Minister of Finance, Kenneth Ofori-Atta, on Friday, October 6.
“We also have the adjustment and fiscal position the Minister mentioned the numbers for June much better than the target,” Mr Roudet told the press.
“The external position in general is stronger, the currency has become much less volatile than what Ghana has experienced at the end of last year when it was a very challenging situation.
“So, clearly there is a turnaround, there is an improvement and signs of macroeconomic stability are now emerging.”
The IMF Mission Chief, however, cautioned the authorities not to be complacent but continue to keep the indicators going up.
“Again, this is not the end of the road [because] inflation is at 40 percent, everybody in this room wants to see it much lower.
“We coming from a position where inflation was 54 percent at the end of last year, so the travelling direction is certainly the right one and things are improving.”
Speaking on this development on the mid-day news on TV3 Monday October 9, Prof Quartey said “we have met the triggers, we have met the targets and that is not surprising to me because if you look at some of the key targets, getting our revenue handles right, new tax instruments that were passed, that has been done as well as an increase in revenue, also ensuring that our fiscal is within acceptable limits.
“All of these point in that direction. The exchange rate has been relatively stable, and inflation is high but it is coming down, even in terms of our growth numbers end of year target was below 2 percent, we have seen first-quarter, and second-quarter growth around 3 percent and we know that granted that nothing unforeseen happens, we normally grow better in the third and last quarters so granted that we grow at 3 percent then we are likely to grow around 3 to 3.5 percent.
“So yes, for me, it is a good signal, some inflows, $600million will come in, which will stabilize the exchange rate, and the government will have some money as well to engage in some of the activities it had planned to undertake.”
On the gains made so far, the Governor of the Bank of Ghana (BoG), Dr Ernest Addison thanked the entire IMF team for what he describes as the constructive engagement during the past two weeks on all issues bordering on fiscal policy, monetary policy, and structural reforms.
Indeed, the Governor said, it has been a very comprehensive and collaborative work between the Government’s side and the IMF.
“We have all established that the very decisive measures put in place by the Government and the Bank of Ghana have started yielding results, signaling a faster than expected turnaround which needs to be sustained as we reset the economy,” Dr Addison said in a statement issued on Monday, October 9.
He added “More specifically, he added “Non-Food inflation has dropped significantly by 19 percentage points, Food inflation has also by some 8 percent, Core inflation, which measures underlying inflation, is also decelerating at a fast pace, From the beginning of the year to date, the Bank of Ghana has built reserves of about US$650 million instead of a programmed drawdown of US$98 million. And this has been boosted by the innovative Gold for Reserves programme.
“And, as a result, we have seen relative stability in the exchange rate, depreciating by only 2.5 percent between February till date. It is therefore very important to sustain this strong performance and consolidate the gains we are seeing. Looking ahead, the Bank of Ghana will continue to maintain a tight monetary policy stance until it is confident that inflation is firmly anchored and aligned with the disinflation path agreed in the program.
“There would be challenges and difficulties as we work towards sustaining these gains but we remained focused and committed to the reforms and prudent policies to ensure the full benefits of this program are achieved.”