In brief
- Base effects drive inflation higher, but underlying price momentum remains contained. Ghana’s headline inflation jumped 160bps to 5.3% in June 2026, marking a third straight rise and the sharpest increase since late-2024, largely driven by unfavourable base effects and modest cost pass-through. We observed a broad-based increase across food (3.9% y/y | +60bps) and non-food (6.3% y/y | +220bps) but with more concentration in non-food, services, and locally produced items. Yet the sharp slowdown in monthly inflation (0.2% m/m | -90bps) signals that underlying price pressures remain controlled, supporting our continued expectation of single-digit inflation through 2026.
- Cooling energy costs set up inflation relief, but food risks will keep policy cautious. We expect headline inflation to ease to 5.0% in July 2026 as lower global oil prices, Cedi appreciation and falling domestic fuel costs potentially reduce non-food price pressures. However, seasonal food supply risks, particularly from vegetables and the onset of a two-month fishing ban, could limit the decline. Despite the real policy rate narrowing to 8.7% (vs the authorities’ preferred double digits), we believe the policy stance remain appropriately tight and the MPC will likely maintain the policy rate at 14.0% in the July 2026 MPC meeting.
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