Producer Price Inflation Rises

Producer price inflation rate recorded 19.6 percent in October 2012 year-on-year, representing an increase in producer inflation of 2.8 percentage points relative to the rate recorded in September 2012. The month-on-month change in producer prices between September and October was 1.1 percent. The producer price index (PPI) measures the average change over time in the prices received by domestic producers for the production of their goods and services. The PPI for Ghana reports the producer price changes since September 2006, as well as the annual year-on-year and monthly inflation rates for all industry (mining and quarrying, manufacturing and utilities) for the last twelve months. In October 2012, the producer price inflation in the mining and quarrying sub-sector increased by 11.3 percentage points over the September 2012 rate of 19.5 percent, to record 30.8 percent. Manufacturing, which consists of more than two-thirds of total industry, increased to 22.2 percent, from a rate of 20.5 percent in September 2012. The utilities sector, which recorded 3.0 percent inflation rate in September 2012, decreased slightly to 2.9 percent in October 2012. In the 12-month period (October 2011 to October 2012), all industry recorded the highest inflation in October 2012 (19.6 percent) and the lowest inflation in December 2011 (13.6 percent). From January to May 2012, the producer inflation fluctuated between 15.0 percent and 16.6 percent. However, in June 2012, the rate rose to 19.1 percent but declined slightly in July 2012 to 19.0 percent and further dropped to 17.8 percent in August. The declining trend continued in September 2012 to record an inflation rate of 16.8 percent. In October, six out of the 16 major groups in the manufacturing subsector recorded inflation rates higher than the sector average of 22.2 percent. Publishing, printing and reproduction of recorded media registered the highest inflation rate (42 percent) while manufacture of machinery and equipment recorded negative inflation (-0.3 percent). The Ghana Statistical Service (GSS) also noted that during the last 12 months, the producer inflation in the petroleum industry exhibited a downward trend. The highest inflation rate in the industry was recorded in October 2011 (26.6 percent) while the lowest in October 2012 was (16.6 percent).