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Food, fuel prices push inflation rate to 15.7% in February 2022 – Citi Business News

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Ghana’s inflation rate has once again risen to hit 15.7 percent in February 2022.

This represents a 1.8 percent jump in the inflation rate compared to the 13.9 percent recorded in the first month of this year.

The current rate is the highest recorded since the rebasing of the CPI and inflation in August 2019.

This new rise in the inflation rate confirms predictions by economists and stakeholders that prices of fuel and food will continue to rise following tensions between Ukraine and Russia.

Already, Ghanaians are bearing the effect of the tensions on the price of fuel, which in turn has led to an increase in transport fares.

According to data from the Ghana Statistical Service, the 15.7 percent increase in February 2022 was mainly influenced by housing, water, electricity and gas (25.4%); transport (18.3%) as well as food and non-alcoholic beverages (17.4%).

Food and Non-Food Inflation

Food inflation regained its dominance, recording 17.4 percent year-on-year inflation, as against the 13.7 percent recorded in the previous month, all above a national average of 15.7 percent.

This month’s food inflation (17.4%) is higher than both last month food inflation (13.7%) and the average of the previous 12 months (10.8%). ‘

Food inflation’s contribution to total inflation increased from 44.2% in January 2022 to 49.4% in February 2022.

Overall month-on-month food inflation was 3.2%, which is higher than both the twelve-month national month-on-month rolling average of food inflation (1.3%) and the rate recorded for February 2021 (0.0%).

All the 15 food subclasses recorded positive month-on-month inflation, with water recording the highest (9.0%).

Non-food year-on-year inflation on average went up again in February 2022 compared to January 2022 (from
14.1% to 14.5%).

Only one out of the 12 Non-food Divisions had the 12-month rolling average to be higher than the year-on-year inflation for February 2022 for the divisions.

Regional Inflation

At the regional level, the overall year-on-year inflation ranged from 11.6% in the Western Region to 19.5% in
the Greater Accra Region.

Eastern Region recorded the highest month-on-month inflation (7.3%) while Upper East region recorded a negative month-on-month inflation rate in February 2022 (-0.9%).



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Most Ghanaians unaware of oil funded projects – PIAC  

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Most Ghanaians are unaware of projects funded with oil funds, a public fora held by the Public Interest and Accountability Committee (PIAC) in the Western North and North East regions have revealed.

In both regions, the Committee held regional public fora on the 2021 PIAC Annual Report, which brought together stakeholders from the traditional council, religious groups, security agencies, traders, educational institutions, among others to deliberate on the management and use of petroleum revenues.

The participants also called for more projects to be executed with petroleum revenues.

PIAC therefore recommended the labelling of Annual Budget Funding Amount (ABFA)-funded projects for identification.

Most Ghanaians unaware of oil funded projects – PIAC  

It again reiterated its commitment to carrying out its mandate to ensure the prudent management and use of petroleum revenues in Ghana.

PIAC commends some oil funded projects but unhappy about some

In terms of the projects funded with petroleum funds, the Committee expressed satisfaction about some, whilst critiquing others, calling for urgent steps to complete them.

The inspection of the projects took place from Sunday, 24th to Friday, 29thApril, 2022.

Most Ghanaians unaware of oil funded projects – PIAC  

In the Western North Region, the Committee inspected the construction of a 3-storey Regional Coordinating Council (RCC) Administration Block in Sefwi Wiawso, construction of three Senior Staff Bungalows at Sefwi Wiawso and a rural market in Amoaya in the Bodi Constituency. The construction of the RCC building received ₵10.5 million from the Annual Budget Funding Amount (ABFA) in 2020 and 2021.

Members of the Committee expressed satisfaction of the project which had been completed, commissioned, and was in use.

The Committee also expressed satisfaction with the senior staff bungalows which received a total of GH₵1,779,660 from the ABFA in 2020.

The project was reported to be 90% complete with bungalows erected and roofed, internal finishing virtually completed, and external works ongoing.

Most Ghanaians unaware of oil funded projects – PIAC  

Again, the Committee welcomed the upgrading of the Nalerigu – Gbintri road, in the North East region which was allocated ₵20 million from the ABFA in 2020. It was also inspected by the PIAC team and officials of the Ghana Highway Authority.

In terms of project that the Committee called for urgent action to be completed, they included the rural market, situated in Amoaya, in the Western North region which received ₵107,327 from the ABFA in 2020, but work had stalled and the construction of a 3-Storey Administration Block for the Council, located in Nalerigu in the North East region.

Construction commenced in 2019, and the project was expected to have been completed in 2021. Outstanding works include painting, tiling, electricals, and furnishing.

PIAC was established under Section 51 of the Petroleum Revenue Management Act (PRMA), to among others, monitor and evaluate compliance with the Act. The Committee was inaugurated and commenced work on 15th September, 2011.



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Manufacturing, Petroleum sub-sectors push Producer Price Inflation to 31.2%

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Government Statistician, Prof. Samuel Kobina Annim

The manufacturing and petroleum sub sectors pushed the Producer Price Inflation (PPI) high to 31.2%, signaling increasing price of goods and services.

According to the Ghana Statistical Services, the month-on-month change in the producer price index between March 2022 and April 2022 was 1.1%.

Indeed, the producer inflation for the Manufacturing sub-sector, which constitutes more than two-thirds of the total industry, increased by 2.6 percentage points to 38.6%.

That of the Petroleum Price Index also went up to 76.1% in April 2022, signaling the rising fuel prices at the pumps.

The PPI in the Mining and Quarrying sub-sector increased by 1.6 percentage points over the March 2022 rate of 33.6% to 35.2% in April 2022.

The utility sub-sector however recorded a 1.1% inflation rate for April 2022.

In April 2022, two out of the 16 major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 38.6%.

Manufacture of coke, refined petroleum products and nuclear fuel recorded the highest inflation rate of 76.1%, while the publishing, printing and reproduction of recorded media recorded the least inflation rate of 2.6%.

For month-on-month, the manufacturing sub-sector recorded the highest monthly inflation rate of 1.6%, followed by the mining and quarrying sub-sector which recorded a rate of 0.4%. The utility sub-sector recorded no inflation in the month of April 2022.

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Increase in policy rate to stifle economic growth – Databank Research

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A further tightening of the Monetary Policy Rate (MPR) of the Bank of Ghana could stifle economic growth, Databank Research has projected.

This is because liquidity levels are already tight on the interbank market

According to its Weekly Fixed Income Update, while it maintains an additional 200 basis hike in the policy rate in 2022, it expect the Monetary Policy Committee (MPC) to exercise restraint in May 2022, deferring a potential 100 basis points hike in MPR to July 2022.

Real returns on fixed-income securities are also depressed with the high inflation profile, continually undermining the Treasury’s financing operations.

“We note that short-term interest rates are misaligned, resulting in negative real yields, which could prompt the MPC to act in the week ahead”, it however pointed out.

Ghana’s inflation continued the relentless run in April 2022, rising to 23.60% year-on-year as against 19.40% in March 2022.

Therefore, inflation has increased by 11% over 4 months in 2022, continuing the upward run since second half of 2021.

The first and second-round effects of petroleum and transport price hikes, elevated food prices and the lagged impact of exchange rate pass through are the main drivers of the April 2022 inflation rate. “We believe these cost-push pressures will persist until the third quarter”, the report stressed. Additionally, it noted that the implementation of the Electronic Transaction Levy from May 1st, 2022, and the impending hike in utility tariffs are further upside risks to inflation



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