Prices in Ghana are still rising despite a consistent decline in inflation, economist Professor Patrick Asuming has cautioned.
Speaking on JoyNews’ PM Express Business Edition on Thursday, June 19, Prof. Asuming warned Ghanaians not to misread the improving inflation data as an indication that the cost of living is decreasing.
“We still have to understand that prices are climbing. Prices are still rising. They haven’t declined,” he stated emphatically. “There is a rate of price increase that has reduced, but that doesn’t mean prices are coming down.”
His caution follows a drop in the Producer Price Index (PPI) from around 18 percent to 10 percent—seemingly good news that, he explained, simply reflects a slower pace of price increases rather than actual price reductions.
Prof. Asuming pointed to persistent challenges, including rising utility tariffs, stagnant wages, and increasing domestic production costs, as key contributors to continued price pressures.
“These tariffs keep going up, and it’s a big element of the cost,” he explained. “Wages are not coming down. The domestic cost of production in the country is rising.”
He also noted that macroeconomic improvements, such as a stronger cedi and declining Treasury bill rates, have yet to bring relief to ordinary Ghanaians.
“The currency has strengthened, yes,” he acknowledged. “But when you put all of that together, we begin to see why we shouldn’t expect that the decline in inflation means prices are coming down anytime soon.”
Prof. Asuming highlighted a growing disconnect between financial indicators and everyday realities.
“It seems to me that the financial and monetary side of the economy has performed better. The real side seems to be lagging.”
He credited the government for stabilising some fiscal indicators, supported by improved global prices for Ghana’s export commodities. However, he warned against over-optimism.
“We have to understand that even though the first-quarter GDP performed beyond expectation, there are still lingering weaknesses,” he said. “If you break down the numbers… five sub-sectors actually saw a decline, though the weightier sub-sectors grew strongly.”
This, he explained, gives the illusion of strong overall growth while concealing underlying fragility.
“The financial indicators are moving forward much better than the real side. And that tends to give you a disconnect between how people are perceiving the economy and the macro numbers they are seeing.”
Prof. Asuming’s remarks serve as a sobering reminder: economic recovery on paper does not automatically mean economic relief in daily life—and falling inflation does not necessarily mean falling prices.
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