The Bank of Ghana’s November 2024 summary of economic and financial landscape has revealed some significant developments in inflation trends, sectoral performance, fiscal operations, monetary policies, and the financial market.
Consumer prices showed a marginal rise in October 2024, with year-on-year inflation at 22.1%, up from 21.5% in September. Food prices increased by 22.8%, driven by a 0.3% monthly uptick.
Non-food inflation remained stable at 21.5%. Core inflation metrics revealed easing trends, with inflation excluding energy, utilities, and food items recorded at 19.1% in October. These shifts indicate gradual stabilization but underscore persistent challenges in food and non-food pricing.
Real GDP grew by 6.9% year-on-year in Q3 2024. Excluding oil, economic growth stood at 7.0%, with the industrial sector leading at 9.3%.
Agriculture services alone saw moderate growth at 5.4%, while services sector overall contributed 5.8% to GDP expansion. The growth trajectory signals robust industrial recovery, complemented by steady agricultural and service activities.
The Monetary Policy Rate however remained unchanged at 27% in October 2024. Treasury bill yields slightly increased, with the 91-day and 364-day rates at 25.80% and 28.70%, respectively. The average lending rate for credit market operations fell marginally to 30.45%, reflecting slight monetary easing amidst inflationary pressures.
The data also revealed the foreign exchange performance of Ghana has not improved as the cedi continues to face depreciation against major currencies. The USD/GHS rate reached 16.30 in October, a 27.1% year-to-date decline. GBP and EUR exchanges followed similar patterns, signaling external sector vulnerabilities.
Commodity markets saw international gold prices rose to $2,689.4 per ounce, a 32.1% year-to-date gain, benefiting from global uncertainties. Prices for cocoa, a key export, declined marginally to $7,273.6 per tonne, though maintaining a 71.7% annual gain. Brent crude oil prices averaged $75.4 per barrel, reflecting a year-to-date decline of 2.4%.
Trade balance according to the data from the Central bank improved significantly, with a surplus of $3.85 billion in October 2024, up from $3.31 billion in September. Exports reached $16.5 billion, driven by strong performances in gold, cocoa, and oil. Imports also increased to $12.66 billion, highlighting steady domestic demand. Gross international reserves rose to $7.89 billion, providing 3.5 months of import cover.
Ghana’s banking sector also demonstrated stability, with total assets growing to GHS 367.2 billion in October, marking a 42.4% annual increase. Deposits rose to GHS 277.3 billion, reflecting growing public confidence. Again, Non-performing loans (NPLs) improved slightly to 22.7% from 22.8% in September, signaling cautious optimism.
The Ghana Stock Exchange’s (GSE) Composite Index increased by 40.1% year-to-date, closing at 4,385.9 in October. Market capitalization also grew by 35.5% to GHS 100.2 billion, driven by gains in financial stocks and improved investor sentiment.
Reserve money expanded by 104.5% year-on-year, influenced by a dynamic Cash Reserve Ratio (CRR) policy. Private sector credit grew by 28.8% nominally, though real credit growth remained modest at 5.5%, reflecting inflation-adjusted pressures.
Ghana’s public debt fell to GHS 761 billion (74.6% of GDP) in October, compared to GHS 807.8 billion in September. Domestic debt accounted for GHS 307.3 billion, while external debt stood at GHS 453.7 billion. Revenue mobilization and expenditure remain pivotal for debt sustainability.
