Ghana’s producer price inflation slowed sharply to 3.5 percent in June 2026, down from 5.8 percent in May, as falling prices in the dominant mining and quarrying sector eased cost pressures across the economy.
Data released by the Ghana Statistical Service (GSS) on Tuesday showed producer prices contracted by 3.7 percent month-on-month, compared with a 1.4 percent decline in May, marking the steepest monthly drop recorded so far this year.
The Producer Price Index (PPI), which measures changes in prices received by producers at the factory gate before taxes, subsidies and retail mark-ups, stood at 267.3 in June, down from 277.7 in May but higher than the 258.2 recorded a year earlier.
According to the GSS, the sharp easing in producer inflation was largely driven by the mining and quarrying sector, which accounts for 43.7 percent of the total PPI basket.
Inflation in the sector fell dramatically from 11.0 percent in May to 2.6 percent in June, reducing its contribution to overall producer inflation and pulling the national rate lower.
“The decline in mining and quarrying inflation did most of the work in easing year-on-year producer inflation,” the report noted.
On a monthly basis, mining and quarrying prices dropped by 9.4 percent, significantly contributing to the overall decline in producer prices between May and June.
While mining cooled, the manufacturing sector showed signs of strengthening.
Annual inflation in manufacturing, which carries a 35 percent weight in the producer price basket, rose from 0.8 percent in May to 3.5 percent in June. The sector contributed 1.2 percentage points to the overall producer inflation rate, making it one of the largest contributors despite the low headline figure.
Several manufacturing subsectors posted strong annual price increases, including fabricated metal products, beverages and leather-related products.
The GSS indicated that manufacturing will remain a key area to watch in the coming months given its sizeable influence on industrial prices.
Among major subsectors, electricity and gas recorded the highest annual inflation rate at 12.5 percent, up from 8.5 percent in May.
Accommodation and food service activities followed with 10.8 percent, while water supply and waste management services posted 10.3 percent inflation.
Transportation and storage prices rose by 10.0 percent year-on-year, reflecting continued cost pressures within logistics and freight-related activities.
Despite these increases, their overall contribution to the headline producer inflation rate was moderated by their relatively smaller weights in the index.
All three broad sectors of the economy recorded lower annual inflation compared with the previous month.
- Industry (excluding construction): 3.3 percent in June, down from 6.0 percent in May.
- Services: 2.5 percent, up modestly but remaining relatively subdued.
- Construction: 4.6 percent, broadly stable compared with 4.3 percent a month earlier.
Construction prices fell slightly by 0.2 percent on a monthly basis, while services recorded a modest 0.5 percent month-on-month increase.
Economists often view producer inflation as a leading indicator of future consumer price movements because production costs eventually filter through supply chains to retail prices.
The latest figures therefore suggest that inflationary pressure at the producer level is easing considerably, potentially providing additional support for efforts to sustain macroeconomic stability.
For businesses, slower growth in input costs could help improve profit margins and reduce the need for price adjustments. For households, the development raises expectations that retail inflation could continue moderating if the trend persists.
However, analysts caution that rising costs in utilities, transport and certain manufacturing segments could still create pockets of inflationary pressure.
Source: businesspostonline
