Published: Thu, April 13, 2017
Health Care | By Jeffery Armstrong

Ghana inflation falls in March, lower health, transport rates help

Ghana inflation falls in March, lower health, transport rates help

Non-food CPI gained marginally to 2.3% in March, putting the first quarter reading also at 2.3%, or nearly a whole percentage point higher than 2016's full-year reading of 1.4%, led by significant jumps in the prices of services such as education and leisure, housing and healthcare.

The consumer price index (CPI), a key gauge of retail inflation, rose 0.9 per cent in the month, the data showed, compared to a 0.8 per cent increase in February.

The unemployment rate is just 4.7 per cent - the lowest level since 1975 - with 1.56million jobless people in the three months to February, 141,000 fewer compared to the same period previous year.

Explaining the headline weakness, the NBS said that food prices fell by 4.4% from a year earlier, largely offsetting an increase in non-food inflation of 2.3% over the same period. Within the miscellaneous items, the inflation for personal care and effects eased to 4.52% and education 5.20%, while inflation rose for transport and communication to 6.04% in March 2017.

"Reflation is close to a turning point", Larry Hu, head of China economics at Macquarie Securities Ltd., told Bloomberg.

This was in part attributed to both sterling and oil prices remaining flat over the month, but economists warn that the later date of Easter this year has distorted the figures, by reducing costs. Petrol dropped by 1p to 119.2p per litre between February and March and diesel fell by 1.1p to 122.1p per litre over the period. In February, it rose 0.6% from the preceding month. With annual inflation now running at 2.3%, real income growth is barely positive as average earnings are rising at about the same pace as consumer prices.

CPI inflation remained unchanged during March at 2.3%, according to the Office for National Statistics (ONS), staying above the Bank of England's 2% target.

United Kingdom food prices saw their biggest annual increase in three years in March, according to the Office for National Statistics.

United Kingdom inflation remained at 2.3 per cent in March as the month saw a more subdued rise in transport costs due to the Easter holidays.

Economists expect inflation to rise again next month as Easter-related price rises kick-in, while rising energy bills are also expected to push up inflation in the coming months.

The rate has been steadily increasing following a period of relatively low inflation in 2015. The urban CPI was at 3.88% in March as against 3.55% in February and 3.95% in March, 2016.

"Today's release confirms our expectations that 2017 will see the end of the consumer spending boom which has driven economic growth in recent years".

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