Ghana’s inflation will rise by 11 per cent in 2019 due to the cedi’s weak performance

Ghana’s inflation rate is projected to rise by 11 per cent this year.

The Governor of the Bank of Ghana (BoG), Dr Ernest Addison

The Economic Intelligence Unit (EIU) made the revelation in its latest country report.

The rise is due to the weak performance of the Ghana cedi.

Although the inflation dropped last month, the Economist Intelligence Unit (EIU) is forecasting that the local currency’s weak performance will undo the work done by the central bank to tame inflation.

The Bank of Ghana last year depleted its reserves to shore up the cedi. The cedi was heavily supported with more than US$600million of international reserves to slow its depreciation to preserve the gains made by cutting the policy rate.

As of February 14, the cedi had depreciated by 3.5 per cent against the US dollar, compared to the 0.0026 per cent appreciation in the same period last year.

But the pressure on the cedi continues amid tightening of the US monetary policy combined with other domestic factors, making the dollar too strong for the local currency.

The report said, “We forecast that inflation will remain elevated in 2019, edging up to 11%, as the weaker cedi combined with modest growth in private consumption continues to drive increases in consumer prices.” 

The average consumer prices, which dropped by 9 per cent last month, are also being projected to rise to 11 per cent this year owing to massive pressure on the cedi.

One dollar is currently equivalent to 5.26 Ghana cedis.

JOIN OUR PULSE COMMUNITY!

Eyewitness? Submit your stories now via social or:

Email: news@pulselive.co.ke

Recommended articles

Sonko’s reaction as daughter Sandra Mbuvi goes international

Sonko’s reaction as daughter Sandra Mbuvi goes international

Amazing transformation of 21-year-old man bullied for being born different (video)

Amazing transformation of 21-year-old man bullied for being born different (video)

Eliud Kipchoge's special Sh20,000 earphones he can't live without

Eliud Kipchoge's special Sh20,000 earphones he can't live without

Abel Mutua's movie makes over Sh4M in 5 days

Abel Mutua's movie makes over Sh4M in 5 days

Vera imports Baby Diapers from US, Help rebuild Boniface Mwangi's house & other stories on #PulseUhondoMtaani

Vera imports Baby Diapers from US, Help rebuild Boniface Mwangi's house & other stories on #PulseUhondoMtaani

Sh79,000 per month jobs for Kenyans without degrees

Sh79,000 per month jobs for Kenyans without degrees

Davido and Chioma spotted together for the first time since rumoured breakup

Davido and Chioma spotted together for the first time since rumoured breakup

How Janet Mbugua's husband Eddie landed Sh240 million deal with Chinese investors

How Janet Mbugua's husband Eddie landed Sh240 million deal with Chinese investors

5 things you should never do to please a woman

5 things you should never do to please a woman