Ghana’s inflation rate hit its highest level in more than a decade.
Ghana’s Statistician Samuel Kobina Annim told Bloomberg, adding that this is coming after the country’s central bank raised the interest rate in anticipation of inflation.
Annim said the annual inflation surged to 19.4% in March, up from 15.7% in February, Government
According to information gathered from the Ghana Central Bank website, the central bank’s inflation target was 8%, but current data shows that the target has been exceeded by 11.4%. Food-price growth surged to 22.4% year-on-year from 17.4% in February, while non-food inflation accelerated to 17% in March from 14.5% in the previous month.
The faster-than-expected rise comes after the monetary policy committee raised its key rate by 250 basis points last month to combat inflation, and the government implemented spending cuts and enacted a tax on electronic payments to reduce the country’s budget deficit and assuage investor concerns about the country’s fiscal targets’ credibility.
Because real interest rates are currently negative, after turning positive last month when the MPC raised rates, sustained increases in inflation are likely to put pressure on the central bank to raise borrowing costs in May. To encourage investment, Ghana seeks a large difference between its benchmark interest rate and inflation.
