Inflation hits 23.8% in December, exceeds BoG’s 2024 target of 15%

Ghana’s inflation rate climbed for the fourth consecutive month, hitting 23.8 percent in December 2024, up from 23 percent in November, according to data from the Ghana Statistical Service (GSS).

The increase marks the highest inflation rate in eight months and the third highest in over a year.

In a press briefing on Wednesday, January 8, 2025, Government Statistician, Professor Samuel Kobina Annim, attributed the rise primarily to soaring food prices.

Food inflation surged to 27.8 percent in December, compared to 25.9 percent the previous month. Key staples, including yams, saw significant price hikes, with yams registering a staggering 63.3 percent year-on-year increase.

While food inflation escalated, non-food inflation saw a modest decline, falling to 20.3 percent in December from 20.7 percent in November. Inflation for locally produced goods rose to 26.4 percent from 25.4 percent, while imported items recorded a slight uptick, reaching 17.9 percent in December from 17.6 percent the previous month.

“We identified a 7.5 percentage point difference between inflation for food and inflation for non-food, with food inflation standing at 27.8 percent and non-food at 20.3 percent in December,” Prof. Annim explained.

Sectors driving the overall inflation increase include alcoholic beverages, tobacco, and narcotics (28.4 percent); food and non-alcoholic beverages (27.8 percent); and housing, water, electricity, gas, and other fuels (26.3 percent).

Regionally, the Upper East recorded the highest inflation at 40.6 percent, while the Eastern Region reported the lowest at 16.8 percent.

Prof. Annim underscored the importance of addressing inflation from both monetary and real-sector perspectives. “With what we’ve seen with food inflation, particularly locally produced food, policymakers must focus on production, value chains, transportation, warehousing, and reducing post-harvest losses,” he advised.

He urged the government to adopt comprehensive strategies rather than relying solely on exchange rate policies or selective interventions. “Policymakers [should] put in diverse interventions rather than focusing on just some selected items that do not cover the variety of food items influencing food prices,” he added.

December’s inflation rate of 23.8 percent exceeded the Bank of Ghana’s revised end-of-year target of 15 percent, highlighting ongoing economic pressures and the rising cost of living.