\xa0 By Juliet ETEFE ( Juliet.etefe@thebftonline.com )
Inflationary pressures moderated to 18.4 percent in May 2025, down from 21.2 percent in April, signaling the fifth sequential monthly drop and reaching its lowest level since February 2022.
This indicates a consistent move towards price stability, providing comfort to families and better forecasting for companies and investors.
The monthly inflation rate decreased marginally to 0.7 percent in May from 0.8 percent the prior month, as reported by the Ghana Statistical Service (GSS).
Speaking to the media, Government Statistician Dr. Alhassan Iddrisu stated that this ongoing reduction in inflation might be due to several macroeconomic elements such as an enhanced cedi exchange rate; more stringent monetary policies; fiscal discipline; and favorable investor confidence.
"We maintain a careful optimism that this trend will persist, providing respite to families and fostering a more stable atmosphere for enterprises and financiers," Dr. Iddrisu stated.
The government's budget for 2025 is targeted at reducing inflation to 11.9 percent by December of that year.
Food and non-food inflation
Although food inflation remained elevated, it decreased to 22.8 percent in May from 25.0 percent in April. Meanwhile, non-food inflation experienced a more significant drop, declining to 14.4 percent from 17.9 percent. Foods were responsible for approximately two-thirds of the total inflation, adding 9.7 percentage points to the primary inflation rate of 18.4 percent.
Non-consumable elements — specifically transportation, housing, and utilities — likewise saw reductions. The inflation rate for transportation fell from 14.9% in April to only 3.1% in May, marking the most significant decrease (a drop of 11.8 percentage points) among all Consumer Price Index categories.
Goods vs services inflation
The increase in prices for goods kept exceeding that of services, with goods showing a rate of 20.1 percent versus 14.3 percent for services. Goods contributed approximately 79 percent towards total inflation, highlighting ongoing cost stresses particularly within consumable categories like food, drinks, and personal care items.
In the category of goods, non-durable items experienced the most significant price increase with an inflation rate of 21.8%, accounting for 10.1 percentage points of overall inflation. Meanwhile, durable goods saw an inflation level of 6.1% and semi-durable goods reported an inflation rate of 19.1%.
Core inflation, which omits fluctuating elements such as energy and food prices, decreased to 18.5 percent in May from 19.5 percent in April. This suggests a widespread reduction in fundamental inflationary pressures.
Domestically made versus foreign-made products
In May 2025, the inflation rate for domestically produced goods decreased to 19.2%, compared to 22.7% in April 2025.
Each month, the inflation rate for domestically produced goods stood at 0.8 percent, which was marginally above the 0.6 percent observed for products coming from abroad.
Regional performance
Out of the 16 regions, 15 experienced a decrease in inflation compared to the previous year. The Ahafo Region had the smallest increase at 14.5%, whereas the Upper West Region still faced the most significant rise in prices, hitting 38.1%.
In Upper West, contributing factors included food at 43.9 percent, educational services at 57.6 percent, and housing and utilities at 124.3 percent.
The Greater Accra, Ashanti, and Eastern regions had the highest impact on nationwide inflation because of their larger representation in the Consumer Price Index (CPI) basket.
Top price drivers
In May, yams, smoked herring, various types of fish and shellfish, vegetable oil, and ginger were key drivers of inflation. Despite ginger showing the steepest price rise at 139.1 percent, it came in fifth place for total impact.
Provided by Syndigate Media Inc. ( Syndigate.info ).
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