Ghana’s inflation rate in January may reach double digits for the first time in eight months after fuel prices were increased 30 percent, leading to higher costs for transport and gasoline, said Standard Bank Group Ltd.
The rate may rise to 10.2 percent in January, said Stephen Bailey-Smith, London-based emerging markets strategist. Inflation was 9.1 percent in November, the most recent data available. December prices will be released by the Ghana Statistical Service Jan. 12.
High costs of fuel imports helped push Ghanaian inflation to a five-year high of 20.7 percent in June 2009. The rate has fallen steadily since then and has remained below 10 percent since June 2010.
“By its nature, an increase in the ex-pump price of crude affects the prices of all other goods and services, basically because of the push it gives to transportation cost,” Bailey-Smith said in a phone interview yesterday.
The price of premium gasoline was increased to 1.52 cedis ($1.02) a liter (0.26 gallons) from 1.17 cedis, according to an e-mail from the state-controlled National Petroleum Authority, which regulates the distribution of fuel in the West African nation.
The Ghana Private Road Transport Union increased fares by 18 percent after the price hike, Alhaji Tetteh, national chaiarman, said by phone yesterday.
The fuel-price increase, the first in 14 months, will ease pressure on spending by the government, which had covered the cost of rising international oil prices, said Sampson Akligoh, an economic analyst at Accra-based Databank Group. Consumer prices may rise to 9.6 percent in January in a “one-off jump before inflation stabilizes to its recent trend again,” Akligoh said by phone yesterday. He forecast a December rate of about 9 percent.
Crude oil for February delivery declined for the second day, shedding $1.05 or 1.2 percent to $88.33 per barrel by 11:23 a.m. in London. The commodity traded at $77 per barrel on Oct. 30, 2009, a day before Ghana’s last fuel price increase, when it was raised 5 percent.
To contact reporter on this story: Moses Dzawu in Accra at +233-302-258-797 or firstname.lastname@example.org.