By GhanaNewsPage 
Driven by Decline in Mining and Construction Sectors
Ghana’s Producer Price Inflation (PPI) recorded a significant decline in March 2025, dropping to 24.4%, down from 27.6% in February.
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This marks a 3.2 percentage point decrease, highlighting a positive shift in producer-level price pressures, according to provisional data released by the Ghana Statistical Service (GSS).
Understanding the Producer Price Index (PPI)
The PPI measures the average change over time in the prices domestic producers receive for their goods and services. As an early indicator of inflationary trends, it offers critical insight into pricing dynamics in Ghana’s productive sectors. A declining PPI often suggests a slowing rate of input cost increases, which could eventually translate to relief for consumers and businesses alike.
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Sector-by-Sector Breakdown
The drop in the national PPI is the result of varied inflation trends across Ghana’s major industrial sectors:
1. Mining and Quarrying
The Mining and Quarrying sector remains the most inflation-prone industry, recording 35.4% inflation in March. However, this figure reflects a significant decline from 43.7% in February, contributing greatly to the overall drop in the national PPI. This downward shift could be attributed to falling global commodity prices, improved operational efficiencies, or stronger regulation of mining-related inputs.
2. Manufacturing
The Manufacturing sector, which constitutes a large portion of Ghana’s industrial output, posted an inflation rate of 22.8%. This figure is up from 20.8% the previous month, indicating that input costs for manufacturers are still rising, albeit at a controlled pace. Higher inflation in this sector could reflect fluctuations in raw material prices, energy costs, and supply chain disruptions.
3. Information and Communication
Notably, the Information and Communication sector reported the lowest producer inflation rate at 4.1%, down slightly from 4.2% in February. This relatively stable inflation rate suggests consistency in pricing and potentially reduced volatility in digital service delivery costs.
4. Construction
The Construction sector also experienced a modest reduction in inflation, with rates falling to 15.4%, compared to 15.8% in February. Lower costs of materials like cement, steel, and logistics could have contributed to this trend, providing hope for a potential rebound in infrastructure investment and housing development.
5. Accommodation and Food Services
This sector, which is directly tied to consumer spending and tourism, saw its inflation dip from 7.8% to 7.2%. The marginal drop reflects improved cost structures and potentially stronger market competition.
Other Key Sectors
While the report did not specify all sectors in detail, it’s important to note that industries such as Electricity and Gas, Water Supply, and Transport and Storage also contribute significantly to PPI figures and are being monitored closely for shifts that might affect the broader economy.
Month-on-Month Comparison
Month-over-month, producer prices increased by a marginal 0.6% between February and March 2025. This indicates that although the annual inflation rate is trending downwards, short-term changes still present price pressures that businesses and policymakers need to manage carefully.
Economic Implications
The steady decline in PPI comes as encouraging news for economic analysts and businesses, especially in a period where global inflation and supply chain volatility have tested national resilience. A lower PPI could eventually filter down into Consumer Price Inflation (CPI), helping to ease the cost-of-living burden on Ghanaians.
However, experts caution that this trend must be sustained across multiple sectors before it can lead to a broad-based economic recovery. Persistent challenges such as currency depreciation, high fuel prices, and import dependency continue to exert upward pressure on input costs.
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Policy Outlook
Economists suggest that the current drop in PPI could support the Bank of Ghana’s monetary policy goals, potentially creating room for interest rate adjustments in the near future. With inflation control being a key component of Ghana’s IMF-supported economic reform program, these trends will be closely watched by policymakers, investors, and international financial partners.
The decline in Ghana’s Producer Price Inflation to 24.4% in March 2025 reflects evolving dynamics across core sectors of the economy. While the figures offer cautious optimism, continued monitoring and proactive policy responses are essential to sustain the momentum. Sector-specific strategies to reduce production costs, diversify inputs, and improve efficiency will be vital in shaping the trajectory of Ghana’s economic stability and growth.
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