Lecturer of Economics at the University of Ghana Business School, Prof. Godfred A. Bokpin, has stated that the high inflation rate for the month of October is not shocking as expressed by many Ghanaians.
This, he explains, is not surprising because the conditions for higher inflation rates were glaring and waiting to burst out at the end of the month.
“It is not surprising, and I am saying it is not surprising because we have seen inflationary pressures becoming entrenched, broadening across food and non-food inflations and the expectation is that inflation will remain elevated until the end of the year.”
He cautioned that there were still hard times ahead and was worried that the situation will not get any better soon.
“If you look at the drivers of inflation now, it tells you the impact it has on households and the reason I say so is that between 42% and 44% of households expenditure in Ghana is on food, so if food inflation is increasing at an increasing rate as we are seeing, then that should tell you the extent to which households are being impacted negatively.”
The year-on-year inflation rate as measured by the CPI was 40.4% for the month of October, as announced by the Government Statistician, Professor Samuel Kobina Annim.
Per the data, food and non-food inflation also rose to hit 43.7% and 37.8% respectively.
The Eastern Region recorded the highest inflation among the 16 regions of the country with inflation at 51.1%, with the Central Region recording the highest food inflation at 57. 9 %.
He also added that the Covid-19 pandemic and the Russia-Ukraine conflict further exacerbated the situation, which significantly affected the purchasing power of many households across the country.
“The rising inflation significantly dwarfs the purchasing power of households because the country has moved from one crisis to the other, and the average household does not have a buffer to withstand the price shocks anymore and makes them [these households] vulnerable.”
He warned that the large volumes of importation that comes with the Christmas festivities must be reduced to help curb the inflation rate for the subsequent months.