Ghana producer inflation jumps to 5.8% as mining and transport costs surge

Ghana's producer inflation rate more than doubled in May, driven largely by rising costs in the mining, transportation and utilities sectors, according to new data from the Ghana Statistical Service (GSS).

The Producer Price Inflation (PPI) rate rose to 5.8% in May from 2.7% in April, signalling stronger cost pressures across key sectors of the economy.

Mining and quarrying recorded the highest year-on-year inflation rate at 11%, reflecting increased production costs in one of Ghana's most important export industries. Water supply, sewerage and waste management followed with inflation of 10.2%, while transportation and storage registered 7.7%.

Electricity and gas prices rose by 6.9% over the period, while construction recorded inflation of 4.3%. Accommodation and food services saw a 2.9% increase.

Manufacturing, one of the country's largest productive sectors, recorded a relatively modest inflation rate of 0.7%, suggesting cost pressures in the sector remained subdued compared with other industries.

Despite the sharp increase in annual producer inflation, the data showed some signs of easing cost pressures in the short term. Producer prices fell by 1.4% between April and May, indicating a month-on-month decline in prices at the factory gate.

Producer inflation measures changes in the prices received by producers for goods and services and is often viewed as an early indicator of future consumer inflation. Rising production costs can eventually be passed on to households through higher retail prices.

The latest figures therefore offer important signals for businesses,

consumers and policymakers monitoring inflation trends and supply chain developments.

In response to the data, the Ghana Statistical Service urged businesses to adopt strategies aimed at managing rising input costs, including securing key materials through forward contracts and bulk purchasing arrangements.

The agency also called on policymakers to strengthen inflation monitoring in sectors such as mining, transportation and manufacturing, where cost increases could feed through supply chains and exert upward pressure on consumer prices.

The May figures suggest that while annual production costs are rising, the recent monthly decline in producer prices could provide some relief if sustained, helping to moderate inflationary pressures in the months ahead.