Revised Inflation Target Within Reach as November Inflation Records a Decline

In line with efforts to drive down the general price levels of goods and services following months of monetary policy tightening, the rate of inflation recorded its fourth consecutive dip in November falling to its lowest in nearly two years. The inflation figure for November was accordingly reported at 26.4%, having edged down from 35.2% in the previous month. A base drift effect resulting from the hyperinflationary figures recorded last year has been a major contributory factor to the persistent drop in the annual inflation reading in the later part of 2023.

The month-on-month inflation rate, however, saw an increase from 0.6% in October to print at 1.5% in November as prices began to adjust upwards ahead of the yuletide. A critical examination of the inflation data revealed that the annual inflation rate was impacted by 9.3% of the items that recorded a reduction in prices, 42.7% of the items recorded between 0.0% to 26.4% increase, and finally the remaining 48.1% recorded rates higher than the national inflation rate.

The seeming upward price pressures on food items lessened in November as the inflation rate recorded on the food and non-alcoholic beverages witnessed a significant decline from 44.8% in October to print at 32.2%. However, the month-on-month inflation figure on food items rose from 0.1% in the previous month to 0.8% in November as twelve sub-group items recorded positive inflation numbers, overshadowing deflationary figures recorded by three sub-group items.

For the non-food and alcoholic beverages group, a strong jump in the month-on-month inflation reading from 1.0% in October to 2.2% in November had minimal impact on the annual inflation figure for this category as the non-food category recorded a drop in inflation from 27.7% to 21.7% respectively. Eight out of the twelve sub-group items led by Insurance & financial services at 8.5% and Transport at 11.5% recorded numbers lower than the group’s annual figure.

Across the regions, the inflation rate hovered between 19.8% in the Greater Accra region and 39.8% in the Western region. Inflation on locally produced and imported items both recorded a decline from 34.4% and 37.0% in October to print at 26.1% and 27.1% in November respectively.

The last sitting of the Monetary Policy Committee saw the committee remain glued to its cautious stance as it warned of the prevalence of upward price pressures on consumer goods and services and hence the need to continue to stay on its wait-and-see stance.