In the latest revelation from the World Bank’s October 2023 Africa Pulse Report, Ghana finds itself grappling with an inflation rate of 40.1%, securing the unenviable position of the fourth-highest inflation rate in Sub-Saharan Africa for the year.
Inflation in the region is topped by Zimbabwe, boasting an inflation rate exceeding 80%, trailed by Sudan at 60%, and Sierra Leone at 42%.
The report underscores that the relentless ascent of food and energy prices continues to be a driving force behind headline inflation in numerous countries across the region.
By July 2023, a significant observation emerged as nearly half of the countries in the region, armed with monthly data on food prices (20 out of 41 nations), reported double-digit year-on-year rates of food inflation. The swiftest surges in food inflation were notably witnessed in Burundi, Ghana, Malawi, Sierra Leone, Sudan, and Zimbabwe.
On a more positive note, the report acknowledges substantial strides in the battle against inflation, with certain countries in the region successfully steering their inflation rates close to or within the central bank’s target bands. Notable mentions include Kenya, South Africa, and Uganda.
However, it is a less rosy picture in some other nations, where inflation continues to hover above target levels, displaying a prolonged period of resilience. Ghana, Nigeria, and Sierra Leone fall into this category.
Despite pockets of disinflation witnessed across the region, the report emphasizes that consumer price growth rates remain stubbornly elevated, surpassing targets and pre-pandemic benchmarks in various instances.
In contrast, the report underscores that four countries in the region are bracing for an acceleration in inflation of more than 10 percentage points in 2023 compared to the previous year. These nations include the Democratic Republic of Congo, Ghana, Sudan, and Zimbabwe.
In the most recent data available, Ghana’s inflation for August 2023 registers at 40.1%, reflecting a decline from the 43.1% recorded in July 2023 – marking the lowest rate observed in the past 12 months. Digging deeper, food inflation dipped to 51.9% in August 2023, down from 55.0% the prior month, while non-food inflation also receded, down 2.9% to 30.9% in August 2023
The intricate interplay of inflation dynamics in Ghana and the broader Sub-Saharan African region continues to captivate economic observers, with both challenges and opportunities for policymakers and investors to navigate.