IC Research has revised its inflation forecast for the end of 2025, lowering it to a range of 10.3% to 12.3%, with a midpoint of 11.3%.

This is down from its earlier projection of 11.8% to 13.8%.

The firm, in its latest report, attributes its more optimistic outlook to expectations of increased food supply during the third-quarter harvest season, as well as a favourable base effect from high inflation levels in the fourth quarter of the previous year.

It noted that these factors are expected to help reduce inflation in the second half of the year.

IC Research pointed out that it envisions a slim chance that inflation could fall into single digits, potentially around 9% by the end of 2025.

However, the anticipated electricity tariff hike in the final quarter and the planned reintroduction of the GH¢1.00 per litre fuel levy on July 16, 2025, could slow the disinflation process.

In the near term, IC Research projects that inflation for July 2025 will decline by 100 basis points to 12.7%.

Still, it warns that the 2.45% increase in electricity tariffs and the ongoing closed fishing season for industrial trawlers could exert upward pressure on prices.

Meanwhile, inflationary figures for June 2025 came in much lower than expected, largely due to the stronger-than-anticipated appreciation of the Ghana cedi.

The annual inflation rate dropped by 470 basis points year-on-year to 13.7%, marking the lowest rate since December 2021. This sharp drop strengthens expectations that the Bank of Ghana may adopt a more accommodative stance at its July Monetary Policy Committee meeting.

On a monthly basis, the country recorded an unexpected deflation of -1.2%, in stark contrast to the earlier projection of a 0.8% increase.

The June inflation decline was driven primarily by a sharp drop in food inflation, which fell to 16.3%, along with continued easing in non-food inflation to 11.4%.

Additionally, transport prices also fell, supported by lower petrol and diesel costs, aided by a stronger exchange rate.

DR/MA

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