Inflation: Fitch Predicts Ghana’s Rising Food Prices To Reduce Significantly In 2023

• The IMF deal has been described as critical for Ghana's ability to overcome the rapid inflation the country is facing
• According to Fitch Solutions, the deal will hold the falling cedi and hence trigger a disinflation
• Fitch Solutions predicts that Ghana's inflation in 2023 will hover around 18.7%, better than the the current 40.4% inflation in October 2022

Ghanaians can heave a sigh of relief as Fitch Solutions has predicted that the rapid price increases for goods and services currently being experienced will in 2023.

According to the international research institution, Ghana’s highly anticipated bailout programme with the International Monetary Fund (IMF) will bring stability to the cedi and thereby trigger a disinflation -- or the situation where prices go down, or do not go up as quickly as before.

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Fitch Solutions says it expects Ghana’s inflation to reduce to about 18.7% in 2023. October 2022 inflation has been announced as 40.4% by the Ghana Statistical Service (GSS).

The heart-warming forecast was contained in a report on Ghana authored by senior country risk analyst at Fitch Solutions Mike Kruiniger.

“We expect disinflation throughout 2023 as the exchange rate stabilised on an expected IMF deal. It will remain elevated at an average of 18.7 per cent,” he said.

Meanwhile, Fitch says even the 18.7% inflation will exert pressure on households’ purchasing power and corporate profit margins and thus limit economic growth.

The report also noted that currently both Ghana’s fiscal and external accounts were under significant pressure.

“We expect that a likely IMF deal will improve Ghana’s fiscal metrics as well as limit risks to its external position in 2023,” the report by Mike Kruiniger said.

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Local Currency Falls Further As $1 Now Selling At GH¢14.90 At Forex Bureaus

Meanwhile, YEN.com.gh has reported in a previous story that the cedi’s woes against the dollar deepened after finance minister Ken Ofori-Atta appeared before the committee hearing a motion of censure filed by the Minority against him.

The cedi has fallen against the dollar and other trading currencies marginally on Monday, November 21, 2022.

Now $1 is selling close to GH¢15, while £1 is selling for GH¢15.6297 and being bought for GH¢15.6128 on the forex market.

Source: YEN.com.gh