Ghana's Economic Comeback: Inflation Plunges to 13.7%, Lowest Since 2021

Government Statistician Alhassan Iddrisu highlighted the continuous decline as evidence that economic policies are yielding results. The positive trend was largely driven by a significant easing in food inflation, which dropped to 16.3% in June from 22.8% in May. Non-food inflation also saw a notable decrease, reaching 11.4%.

This sustained slowdown is crucial for Ghana, which is steadily emerging from its most severe economic crisis in a generation. The crisis, which peaked in 2022-2023, was characterized by soaring public debt, a rapidly depreciating currency, and spiraling inflation, leading to a loss of international market access. The nation has since embarked on a comprehensive reform program, including a $3 billion Extended Credit Facility (ECF) with the International Monetary Fund (IMF), approved in May 2023, aimed at restoring macroeconomic stability and debt sustainability.

The Bank of Ghana maintained its benchmark policy rate at 28% at its last Monetary Policy Committee meeting in May, a stance reflecting a cautious approach despite the encouraging inflation data. The central bank's next monetary policy decision is highly anticipated later this month, with expectations building for a potential adjustment in response to the latest figures.

The government has set an ambitious inflation target of 11.9% by year-end, and the current downward trajectory positions Ghana favorably to meet this objective, bolstering confidence in its economic recovery trajectory.