Ghana’s Producer Price Inflation (PPI) hit its lowest point in three months, dropping to 18.5% in April 2025 from 24.4% in March, according to the latest data from the Ghana Statistical Service (GSS). This marks the third consecutive decline in PPI, signalling easing cost pressures in key production sectors and presenting opportunities for economic stabilization.
The significant 5.9 percentage point reduction was primarily driven by notable slowdowns in the mining and quarrying and manufacturing sectors, which together accounted for nearly 95% of the overall PPI. The mining and quarrying sector’s contribution dropped sharply, with year-on-year inflation falling from 35.4% in March to 24.3% in April. Similarly, the manufacturing sector saw inflation ease from 22.8% to 19.6%. Other sectors, such as transport and storage, also reported declines, with inflation reducing from 20.4% to 16.2%.
On a month-to-month basis, the data reflected deflation of 0.8%, a stark contrast to the 0.6% increase recorded in March. This implies producers received lower prices for their goods and services compared to the previous month, potentially easing pressure on consumer prices.
Opportunities and Challenges for Growth
The GSS emphasized that the current trend of falling input costs could serve as a catalyst for broader economic relief if businesses pass on these savings to consumers. Lower producer prices could reduce the cost of living, offering a respite to inflation-stricken households.
However, the report also highlighted potential risks. Declining factory gate prices might squeeze profit margins, particularly for businesses already grappling with high operational costs. To navigate this, the GSS advised companies to optimize operations, prioritize local sourcing, and cautiously pursue expansion plans.
A Call for Strategic Action
Describing the current economic climate as “a window for stabilization and responsible investment,” the GSS urged policymakers and private sector players to collaborate in leveraging the easing inflationary pressures. Strategic investments, coupled with effective cost management, could pave the way for sustainable growth and economic resilience.
This encouraging trend in producer inflation sets a positive tone for Ghana’s economic trajectory, offering hope for enhanced productivity and stability in the months ahead. As key sectors recalibrate to adapt to the changing dynamics, the broader economy stands poised for cautious optimism and recovery.
Story by: Mercy Addai Turkson #ahotoronline.com
