Ghana’s Inflation Rate Climbs to 42.2%
Ghana’s headline inflation rate accelerated to 42.2% year on year in May, a 100 basis point increase from 41.2% in April, the statistics said in a statement on Wednesday. The government faces the worst economic crisis, a development that was triggered in part by covid-19 pressures and the Ukraine-Russia war.
The country defaulted on loan repayment sequentially and initiated a debt exchange programme to reduce pressures from demand for payments by local fixed interest securities investors.
The government had borrowed 98% of its gross domestic product and ran into trouble after access to the Eurobond market was closed against it amidst global interest rate hikes.
Authorities turned to the International Monetary Fund for a support package in July last year after rampant inflation spurred street protests.
The multilateral lender required the government to restructure the nation’s debt as part of the condition to access a $3 billion loan facility.
Data from the statistics office showed that Ghana’s inflation reached a more than two-decade high of 54.1% in December, but it declined for the fourth consecutive month up to April.
The central bank kept its main lending rate unchanged in May, saying tight monetary policy and relative exchange rate stability were helping inflation fall. #Ghana’s Inflation Rate Climbs to 42.2%