Inflation rate drops, trend expected to continue

Accra, June 9, GNA - Figures released on Wednesday by Ghana Statisti cal Service (GSS) indicates that the country's inflation rate has dropped fro m 11.66 per cent in April 2010 to 10.68 per cent in May, inching closer to the desired single digit sought by government.

"There are indications that our target for headline inflation specif ied as a single digit by the end of 2010 is within reach," said that the Minister of Finance and Economic Planning, Dr. Kwabena Duffuor in a statement issued in Accra by the Ministry and copied to the GNA. The statement said the rate of inflation had consistently been fall ing since the beginning of the second half of last year. It said the development was in response to the sound monetary and fiscal policies adopted at the beginning of 2009 to correct the deteriorations of 2008.

The statement said Dr Duffuor advised that "as a country, we must never again, either by playing politics with inflation and interest rates , or taking risk with public figures or just thinking short term allow our hard won economic stability to be put at risk". "For it is not by chance but by working together that we have inflat ion today at its lowest rate in more than two years but the bigger prize is t o ensure that businesses can plan within an environment of lower inflation, " the statement quoted Dr Duffour as saying.

The statement said a contributory factor to the drop in inflation wa s the strength of the Cedi that had been experiencing an "unprecedented" le vel of stability in the last 12 months.

It said interest rates at both the money and capital markets had consistently fell and that the trend was expected to continue as governme nt's fiscal consolidation measures continued to bear fruit.