Producer inflation has increased to 13.3 percent in January 2020 – its fourth consecutive monthly rise – reaching an all-time high in more than three years, according to data released by the Ghana Statistical Service (GSS) this week.
This rate represents a 0.3 percentage point increase in producer inflation relative to the rate recorded in December 2019 of 13.0 percent.
The Producer Price Index (PPI) measures the average change over time in the prices received by domestic producers for the production of their goods and services.
The increase for all industry can be attributed to the manufacturing sector, specifically the manufacture of petroleum products. The rate for manufacturing of petroleum products increased from 8.2 percent in December 2019 to 13.0 percent in January 2019.
The producer inflation for Manufacturing which constitutes more than two-thirds of total industry increased by 0.8 percent to record 9.6 percent. During the month of January 2020, five out of the sixteen major groups in the manufacturing sub-sector recorded producer price inflation rates higher than the sector average of 9.6 percent.
Petroleum Price Index
The producer inflation rate in the petroleum subsector was 3.8 percent in January 2019. Thereafter, the rate increased consistently to record 17.2 percent in April 2019, but then declined sharply to 1.2 percent in June 2019. However, it increased to 3.1 percent in August 2019 but declined again to -5.7 percent in October 2019.
Thereafter the rate increased consistently to record 13.0 percent in January 2020.
The producer price inflation in the Mining and Quarrying sub-sector decreased by 1.5 percentage points over the December 2019 rate of 33.7 percent to record 32.2 percent in January 2020.
The utilities sub-sector recorded a producer price inflation rate of 12.6 percent for January 2020 indicating a marginal decrease of 0.1 percent from the December 2019 rate of 12.7 percent.
PPI Trends
In January 2019, the producer price inflation rate for all industry was 3.4 percent. Thereafter, it resumed an upward trend to record 7.1 percent in April 2019 but declined to 6.7 percent in May 2019. Subsequently, it increased consistently to record 10.2 percent in August 2019 but declined to 8.9 percent in October, 2019. The rate then increased again consistently for four consecutive months to record 13.3 percent in January 2020.
