Can Ghana sustain producer price inflation slowdown?

Ghana's Producer Price Inflation has witnessed a slight dip, dropping to 29.9 per cent in the month of June, as per data from the Ghana Statistical Service. The decline has been attributed to price decreases in the construction and services sector. This marginal improvement has sparked discussions on whether Ghana can sustain this slowdown in producer price inflation moving forward. Richmond Frimpong, a Financial Advisory Consultant, shared insights on the implications of this dip and the potential outcomes. Frimpong highlighted the challenges facing the ease of doing business in Ghana, emphasizing the impact of policy changes on businesses, primarily those in the free zones category. He noted that recent shifts in regulatory bodies have added complexity to business operations in the country. Looking ahead, Frimpong discussed the upcoming meetings of the Monetary Policy Committee (MPC) and speculated on possible rate hikes to curb inflation. He suggested that the central bank might consider a hike between 100 and 250 basis points to balance price stability and economic growth. The consultant also addressed the ongoing debt restructuring efforts in Ghana, particularly focusing on the engagement with institutional investors. Frimpong expressed optimism about the success of the debt exchange deal, emphasizing the importance of investor response for future tranches. Overall, the discussions shed light on Ghana's economic outlook and the measures being taken to address inflation and debt challenges.