Inflation to remain within medium-term target band of 8±2% – Bank of Ghana reiterates

The Bank of Ghana has reiterated that inflation will remain within the medium-term target band of 8±2%, but closer to the upper limit in the near-term, barring any unforeseen shocks.

This is coming after October 2021 inflation hit 11.0%

According to the Central Bank’s September 2021 Inflation Outlook and Analysis Report, the main upside risks to inflation in the outlook include the elevated global inflation, pressures from domestic food prices and high ex-pump prices.

Headline inflation is also projected to remain within the medium-term target band in the near-term, driven broadly by food prices.

 This reflects recent supply shocks which the Central Bank said is expected to put upward pressures on food prices.

Food inflation is forecast to remain elevated in the near-term before declining to the central path in the medium-term.

In contrast, non-food inflation is expected to stay close to the central path in the outlook.

It added that headline inflation is expected to ease to the central path in the medium term as food price pressures abate.

However, imported inflation is expected to stay elevated in the near-term and exert some upward pressures on domestic prices before easing as inflation returns to target in trading-partner countries.