Ghana‘s Producer Price Inflation (PPI) surged to 28.5% in January 2025, up from 26.1% in December 2024, marking a 2.4 percentage point increase over the previous month. The rise in producer inflation was largely fueled by higher costs in the mining and quarrying, construction, accommodation and food service sectors. This is according to the latest report from the Ghana Statistical Service (GSS).
The industry sector, excluding construction, experienced the sharpest increase in producer inflation, rising from 40.2% in December 2024 to 43.7% in January 2025. The construction sector also saw a modest increase to 29.8%, while the services sector recorded 7.7% producer inflation, remaining the least affected.
Among specific industries, mining and quarrying recorded the highest inflation rate of 47.5%, significantly above the national average of 28.5%. The construction sector followed with 29.8%, while accommodation and food services saw a producer inflation rate of 29.0%. In contrast, water supply, sewerage, and waste management recorded the lowest inflation at just 4.8%.
On a month-on-month basis, producer prices increased by 3.6% from December 2024 to January 2025, a sharp contrast to the 1.4% decline recorded the previous month.
On a year-on-year basis, the PPI reflects the changing cost of production for businesses. The 28.5% year-on-year inflation rate in January 2025 indicates that the cost of producing goods and services has risen significantly compared to January 2024.
Economic Implications for Businesses
The rising producer inflation suggests higher production costs for businesses, which could lead to increased consumer prices in the coming months, potentially impacting household spending and business profitability.
The continued surge in mining and construction costs could also influence infrastructure projects, housing prices, and raw material costs for industries dependent on these sectors.
With the January 2025 PPI hitting 28.5%, businesses across Ghana are likely to face higher production costs, which may eventually be passed on to consumers. Stakeholders will also be monitoring closely to see whether these inflationary pressures will impact other sectors of the economy.
