The Producer Price Inflation (PPI) rate, a measure of the ex-factory prices of goods and services in the country, rose for the fourth consecutive month to 13.6 percent in November 2021.

November’s PPI rate represents a 3.0 percentage points increase in producer inflation relative to the rate of 10.6 percent recorded in October 2021.

This rate is an indication that the average prices that domestic producers received for the production of their goods and services have gone up year-on-year, thus between November 2020 and November 2021. After declining from 8.4 percent in July 2021 to 8.1 percent in August 2021, producer price inflation has picked up strongly in the subsequent months of the year.

The month-on-month change in producer price index between October 2021 and November 2021 was 2.8 percent, the highest in the past six months. It is 0.8 percentage points higher than the month-on-month PPI rate of 2.0 percent between September and October.

PPI Trends

Notably, the Ghana Statistical Service (GSS) provided information on inflation rates for all industry and its three major sub-sectors for the last twelve months. The major sub-sectors include Mining and Quarrying, Manufacturing and Utilities.

In November 2020, the producer price inflation rate for all industry was 8.1 percent. The rate declined to record 7.0 percent in December 2020. In March 2021, the rate increased to 13.0 percent, but declined to 10.9 percent in April 2021. In May 2021, the rate increased to 11.8 percent but decreased continuously to record 8.1 percent in August 2021. Since then, the rate increased continuously to 13.6 percent in November 2021.

Manufacturing Sector

The producer inflation for the Manufacturing subsector, which constitutes more than two-thirds of the total industry, increased by 3.9 percentage points to record 20.0 percent. This was the highest year-on-year inflation within the industry sector in November 2021.

The manufacturing sub-sector also recorded the highest monthly inflation rate of 3.6 percent, followed by the mining and quarrying with 1.9 percent, while the utility sub-sector recorded no change in month-on-month inflation.

In November 2021, one out of the sixteen major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 20.0 percent. Manufacture of coke, refined petroleum products and nuclear fuel recorded the highest inflation rate of 58.4 percent, while the Manufacture of motor vehicles, trailers and semitrailers recorded the least inflation rate of -0.3 percent.

The producer price inflation in the Mining and Quarrying sub-sector was 1.8 percent in November 2021, a 2.8 percentage points increase over the October 2021 rate of -1.0 percent. The inflation rate for the utility subsector was 0.2 percent in November 2021.

Petroleum Price Index

The producer inflation rate in the petroleum subsector was -5.0 percent in November 2020. The rate declined to record -4.0 percent in December 2020. Subsequently, the rate increased continuously to peak at 31.0 percent in March 2021 but declined to 23.9 percent in June 2021. The rate increased continuously to record 38.2 percent in October 2021 and inched up to record 58.4 percent in November 2021.

As usual, the GSS warned that the PPI figure for November 2021 is provisional and is subject to revision when additional data become available. However, all other indicators contained in the PPI Newsletter for November 2021 “are final”.