Ghana’s Inflation Rate Slows

Ghana’s inflation fell for the ninth consecutive month in March, fuelling speculation the central bank will cut interest rates for the third time since November as early as this week.

Inflation slowed to 13.3 percent from 14.2 percent in February, the Ghana Statistical Service said in a statement handed to reporters today in the capital, Accra.

The central bank plans to reduce its benchmark interest rate “gradually” as inflation eases, rather than repeat February’s 2 percentage-point cut, Deputy Governor Millison Narh said on March 30. The inflation rate may end the year at between 9.2 percent and 9.5 percent, the Governor Kwesi Amissah-Arthur said a day later.

“There is still room for further interest rate cuts” until the third quarter of the year, Samir Gadio, a Lagos-based analyst with Renaissance Capital, said in an e-mail yesterday. He forecast the central bank will cut its key rate by as much as 1 percentage point to 15 percent on April 16.

Inflation has slowed from a high of 20.7 percent in June after the domestic currency, the cedi, halted its slide against the dollar, which had driven up the cost of imports. The cedi, which declined 15 percent against the dollar in the first half of 2009, rose 4.5 percent in the second half of the year and is little changed this year.

Credit: Emily Bowers