Inflation Declined to 16.9% in November

Ghana’s inflation rate fell to 16.9 percent in November, the fifth consecutive decline and the lowest since May 2008, fueling expectations of another interest rate cut by the central bank.

The rate dropped from 18 percent in October, Grace Bediako, a statistician at the Ghana Statistical Service, told journalists in the capital, Accra, today.

Inflation has been slowing since the domestic currency, the cedi, halted its slump against the dollar six months ago. After falling 15 percent for the first six months of the year, the cedi has gained 4.7 percent since July. Weaker inflation led the Bank of Ghana to cut it key lending rate by half a point to 18 percent last month, the first reduction in almost three years.

“The market should anticipate further prime rate reductions” as inflation keeps declining, Sampson Akligoh, an economist with Accra-based Databank Financial Service, said in an e-mailed note.

Finance Minister Kwabena Duffuor forecast on Nov. 18 that the inflation rate, which reached a five-year high of 20.7 percent in June, would end the year at between 15 percent and 16 percent.

Akligoh said he expects inflation to “continue to inch down in December”.

Food prices increased an annual 12.4 percent in November, compared with 13.5 percent in October, while non-food inflation slowed to 20 percent from 21.2 percent, Bediako said.