Mining activities drive producer inflation upwards in June 2019

Activities within the mining and quarrying subsector in June 2019, have led to an increase in the producer price inflation (PPI) by 0.9 percentage points to record 7.6 percent, year on year (y-o-y).

The latest data released on the PPI by the Ghana Statistical Service (GSS) indicates that the inflation in the Mining and Quarrying sub-sector increased by 7.3 percentage points over the May 2019 rate of 15.1 percent to record 22.4 percent in June 2019.

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 service.

Manufacturing

The producer inflation for Manufacturing, which constitutes more than two-thirds of total industry, decreased by 0.1 percentage points to record 6.1 percent. However, this had little impact on the overall changes in the rates for the month.

During the month of June 2019, eight out of the sixteen major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 6.1 percent. Manufacture of machinery and equipment recorded the highest inflation rate of 23.5 percent, while Tanning and dressing of leather recorded a zero-inflation rate.

The utilities sub-sector recorded inflation rate of 1.2 percent indicating an increase of 0.1 percentage points over the rate recorded in May 2019.

Trends

In June 2018, the producer price inflation rate for all industry was 7.7 percent. The rate increased 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 resumed the upward trend to record 7.1 percent in April 2019 but declined to 6.7 percent in May 2019. However, the rate increased to 7.6 percent in June 2019.

Petroleum Price Index

The producer inflation rate in the petroleum subsector was 44.2 percent in June 2018. Subsequently, the rate decreased to 31.1 percent in September 2018. However, it increased again to 36.1 percent in October 2018 but then resumed a downward trend to record 3.8 percent in January 2019. The rate increased consistently to record 17.2 percent in April 2019. However, in June 2019 the rate decreased to 4.2 percent.