In brief
- Landing softly on the bullseye. The trend of disinflation in the Ghanaian economy continued for the tenth consecutive month as annual headline inflation landed softly on the bullseye at 8.0% year-on-year in October 2025. This represents the lowest annual inflation print since June 2021 (7.8%), significantly better than the Treasury’s end-2025 target (11.9%) and a perfect landing on the midpoint of the Bank of Ghana’s medium-term target (8.0% ±2.0%). Food inflation returned to single digits for the first time since July 2021, declining by 150bps to 9.5% y/y while non-food inflation fell deeper into single digit at 6.9% y/y.
- The stronger disinflation momentum widens the scope for a deeper rate cut. We expect annual headline inflation to fall sharply to 6.5% in November 2025 (-150bps), driven by a strong base effect and the Cedi’s recent appreciation, which will ease fuel and transport costs and reinforce the decline in food inflation. The sharper-than-expected disinflation in October 2025 strengthens our dovish conviction, with the real policy rate now at 13.5%, and likely widening to 15.0% if our November inflation forecast materialises. This creates ample scope for a deeper 400bps cut in the policy rate to 17.5% at the November 2025 MPC meeting while still maintaining an appropriately restrictive monetary stance.
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