Ghana’s inflation rate fell for an eighth straight month to the lowest level in almost four years, supporting the argument for a further reduction in borrowing costs.
Annual inflation slowed to 11.5% in August from 12.1% in the previous month, Government Statistician Alhassan Iddrisu told reporters in the capital, Accra, on Wednesday. Prices fell 1.3% in the month, he said.
The world’s second-largest cocoa grower and Africa’s top gold producer is benefiting from rising commodity prices that have driven a 23% gain in the cedi against the dollar this year and tempered inflation.
It traded little changed at 11.95 per dollar by 10:36 a.m. in the capital, Accra, after depreciating for six straight days.
The slowdown may convince the Bank of Ghana’s monetary policy committee to lower interest rates at its Sept. 17 meeting, after a 300 basis-point cut to 25% in July. But the recent weakness in the cedi may lead it to adopt a more cautious approach.
The central bank expects inflation to return to its 6% to 10% target range by year-end.
Governor Johnson Asiama said at the time the MPC would “continue to assess incoming data and likely reduce the policy rate further should the disinflation trend continue.”
Food inflation decelerated to 14.8% in August from 15.1% a month earlier, while non-food price growth eased to 8.7% from 9.5%.
