Data released by the Ghana Statistical Service (GSS) has shown a decline in the producer price inflation for the month of May 2019, resulting from a decline in the manufacturing sector’s producer price growth rate.
The producer price inflation for manufacturing which constitutes more than two-thirds of total industry decreased by 1.3 percentage points to record 6.2 percent in May 2019
The PPI for May 2019 was 6.7 percent, indicating that between May 2018 and May 2019, year-on-year (y-o-y), producer prices increased by 6.7 percent. This rate represents a 0.4 percentage point decrease in producer inflation relative to the rate recorded in April 2019 at 7.1 percent. This suggests that expectedly domestic consumer inflation will continue to fall and all other things being equal, this could pull down headline inflation as a whole.
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.
Inflation in the mining and quarrying sub-sector increased by 2.8 percentage points over the April 2019 rate of 12.3 percent to record 15.1 percent in May 2019.
For the third consecutive month, the utilities sub-sector recorded an increase in the inflation rate to record 1.1 percent, with an increase of 0.1 percentage point over the rate recorded in April 2019.
During the month of May 2019, six out of the sixteen major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 6.2 percent.
Manufacture of motor vehicles, trailers and semitrailers products recorded the highest inflation rate of 10.9 percent, while Tanning and dressing of leather and Manufacture of machinery and equipment products recorded zero inflation.
In May 2018, the producer price inflation rate for all industry was 7.1 percent. Subsequently, it increased continuously to record 8.2 percent in July 2018, but declined to 5.8 percent in September 2018. In October 2018, the rate increased to 7.2 percent, but declined continuously to record 3.4 percent in January 2019.
Since then the rate had resumed the upward trend to record 7.1 percent in April 2019 but has declined to 6.7 percent in May 2019.