Weak Ghana cedi pushes February’s producer price inflation up by 5.4%

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Ghana’s Producer Price Inflation for February 2019 went up by 5.4 percent, representing a 2.0 percent increase from the 3.4 percent recorded in January 2019.

The Producer Price Index, which measures the price manufacturers sell their products at the wholesale level, was pushed up by the poor performance of Ghana’s currency – the Cedi, which has lost about 9 percent of its value since the start of 2019.

The 5.4 percent increase means retailers paid more on goods they purchased at the factory level compared to what they paid in January.

However, the rate is a 0.1 percent reduction of the 5.5 percent Producer Price Inflation recorded in the same month last year.

According to the Ghana Statistical Service the increase was largely due to the depreciation of the cedi and the cost of Gold and refined petroleum products on the world market.

Prices in the Mining and Quarrying industry recorded the highest increase at 4.5 percent to 13.4 percent from the 8.9 recorded in January.

This was followed by the Manufacturing sector which constitutes two-thirds of the industry. It recorded a 2 percent increase to 5.0 percent.

However, prices in the utilities sector did not record any increase.

“We are usually not able tell how the system react to policies put together by government. For example, the cedis was depreciating and we have the Finance Minister talking about measures to stabilize it in the shortest possible time. When that happens it is likely to have an impact on the market but we don’t know how,” Acting Government Statistician, David Kombat, said at a press conference in Accra.

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