- Headline inflation accelerated to 40.4% y/y in October 2022 from 37.2% y/y a month earlier.
- The surge in food prices was a major driver of headline inflation as food inflation soared to 43.7% y/y in October 2022 (vs 37.8% in September 2022).
- Since November 2021, we have seen a cumulative increase of 1,100bps in the monetary policy rate to 24.5% as of October 2022. However, intensified FX pressure has emboldened CPI inflation which appears intractable at this point.
- Against the backdrop of recent hikes in ex-pump prices and a 19% increase in commercial transport fares, we foresee further rises in headline inflation in the final two months of 2022.
- The latest upsurge in headline inflation with upside risk to the near-term outlook strengthens the case for another hike in Ghana’s monetary policy rate at the final MPC meeting for 2022.
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