The rate at which the general price level of goods and services change over time, thus inflation inched up for the seventh consecutive time to peg at 11.8 per cent in July 2013.
The rate is per the rebased Consumer Price Index (CPI) which has 2012 as its base index and meant to reflect the actual consumption pattern of individuals.
Inflation slipped from the single digit target by government in January 2013 after it recorded a rate of 10.1 per cent and has increased steadily to its current rate.
Although the combined pressures of the food and non food basket push the rate up often, the trend for July was different as the food component recorded 7.3 per cent same as June 2013.
The non-food component however recorded a rise from 15.1 per cent in June to 15.4 per cent in July 2013.
Governor of the Bank of Ghana, Dr Henry Wampah at the last Monetary Policy Committee (MPC) press briefing explained that inflation could further move up given the upside risk of potential pass-through effects of further petroleum price adjustments, possible adjustment of utility tariffs, and pressures arising from the impending public sector wage settlement.
According to him, these could however be moderated by the tight monetary policy stance, the ongoing fiscal consolidation and favourable seasonal factors arising from the oncoming harvest season.
The Government Statistician, Dr Philomena Nyarko responding to concerns about further increase of the rate could not give a definite stance as according to her, their work relied heavily on available data and not forecast.
But with the oncoming harvest season, the food inflation is likely to fall while other factors could push the non food inflation up, hence making it difficult to determine the outcome of the rate in the months ahead.
She however explained that the rising exchange rate could affect the rate as not all food items are grown locally because others are imported and those one would feel the impact of declining fortunes.
Governor Wampah said the inflation forecast had shifted marginally since the last MPC meeting although the Committee noted that the forecast for end-year inflation is likely to be close to the upper band.
“However, subject to the rate and timing of the adjustment in utility tariffs, the forecast could return to central path by the first quarter of 2014,” he said.
Meanwhile, brisk economic activities in the Western Region as a result of the oil find pushed the regions inflation up to 15.0 per cent, higher than the national rate of 11.8 per cent.
She however added that the fact that the rate is rising does not necessarily mean prices are high in the region but it tells you the consumption pattern of people there as a result of the natural resource finding.
The Ashanti Region followed closely with 14.1 per cent while inflation was lowest in the Upper East Region with 4.6 per cent. GB
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