Next week, on Thursday, November 12, Finance Minister Dr Cassiel Ato Forson will present the Government of Ghana’s proposals with regards to its 2027 budget and economic policies to Parliament. But this presentation will come just a day after the Ghana Statistical Service (GSS) is expected to officially announce the consumer price inflation for October on Wednesday, November 11 as the GSS conventionally presents the Consumer Price Index (CPI) data on the second Wednesday of every month.
With expectations of inflation a crucial factor in budgetary and economic policy planning this may amount somewhat to government taking aim with shrouded vision.
As the country prepares to announce its October 2026 Consumer Price Index (CPI) figures, economists and financial-market analysts are watching closely for evidence of whether the modest resurgence in prices recorded in August and September represents a temporary interruption of the disinflation process or the beginning of a more sustained upward movement.
The September inflation rate of 5.2 percent, up from 5.0 percent in August, has already raised questions about the prospects of achieving the Government’s ambitious year-end inflation objective. The October figures are particularly important because higher transport costs, rising international crude oil prices and less favourable food-price comparisons could combine to push the annual inflation rate higher.
Indeed, International Capital Group (IC Group), a Ghanaian financial-services institution, has projected that headline inflation could reach about 6.0 percent in October, representing an increase of 0.8 percentage points over September. Its assessment points to a combination of food-supply constraints, transport-fare adjustments and higher fuel prices.
Trading Economics’ Global Macro Models projects the inflation rate to hit 7.10 percent by the end of the quarter. Their econometric expectations suggest that despite near-term supply shocks or holiday demand, the intermediate-term path will fluctuate within the single-digit band, averaging roughly 5.90 percent moving into 2027
Both of these projections are significantly more cautious than the outlook implied by the International Monetary Fund’s latest October projections, which put Ghana’s end-2026 inflation at 4.8 percent. They also raise questions about whether the Government’s earlier expectation of bringing inflation down to 5.0 percent by December remains achievable.
Transport and food prices create upside risks
IC Group’s forecast is based on the expectation that the full effect of an eight per cent increase in administrative transport fares, which was not adequately reflected in September’s inflation figures, would feed into October consumer prices. Higher fuel prices, with international crude oil exceeding US$100 per barrel in its modelling assumptions, are expected to reinforce this effect.
The institution also identifies an unfavourable base effect arising from weaker food-supply conditions compared with October 2025. However, it expects unchanged utility tariffs to limit the extent of the increase.
The significance of the forecast is reinforced by the September inflation breakdown published by the Ghana Statistical Service (GSS). Food inflation rose from 3.0 percent in August to 4.0 percent in September, while non-food inflation moderated from 6.8 percent to 6.2 percent.
More revealingly, services inflation stood at 8.3 percent, compared with 4.2 percent for goods.
Government Statistician, Dr Alhassan Iddrisu, identified three principal sources of the emerging pressure: fresh food prices, domestic production costs and persistent services inflation.
This suggests that Ghana’s inflation challenge is no longer primarily one of imported merchandise prices. Domestic distribution costs, food supply chains, accommodation and other services are becoming increasingly important determinants of the consumer price index.
A possible further increase in November is on the cards
For November, the balance of available evidence suggests that inflation could remain on an upward trajectory, although the extent of any additional increase will depend on whether October’s transport and fuel-price adjustments persist and whether food supplies improve.
IC Group’s October assessment anticipates that the effects of these pressures will become more visible in the immediate inflation outlook. Its analysis also anticipates that the Bank of Ghana will maintain its Monetary Policy Rate at 14 per cent at the November Monetary Policy Committee meeting.
Fitch Solutions, the research arm of international ratings agency Fitch, similarly expects the central bank to maintain the policy rate at 14 percent through December.
Their assessment is that inflation will continue rising, but that the increase will not be sufficiently severe to warrant an immediate monetary tightening.
The UK-based institution attributes the anticipated increase principally to elevated energy costs associated with the continuing US-Iran conflict and the Ghana cedi beginning to weaken on a year-on-year basis.
Fitch has nevertheless emphasized that Ghana’s inflation performance remains considerably better than its historical average.
In its October assessment, it observed that consumer price inflation had averaged approximately four per cent during 2026, compared with a 15.7 percent average over 2010–2025.
The firm consequently projected that inflation would reach 6.8 percent by December, while remaining below the Bank of Ghana’s medium-term target midpoint of eight per cent.
Competing institutional forecasts for end – 2026
The greatest differences in expectations emerge when the various institutions’ year-end projections are compared.
The IMF’s latest October 2026 World Economic Outlook projection places Ghana’s end-year inflation at 4.8 percent, a substantial reduction from its earlier projection of 7.9 percent.
The Fund’s more optimistic assessment reflects improved fiscal discipline, stronger commodity export earnings, particularly from gold, and the country’s improved external position.
However, this projection is considerably below both IC Group’s October expectation and Fitch Solutions’ December forecast.
Fitch’s 6.8 percent projection is two percentage points higher than the IMF’s estimate, suggesting that international institutions are not necessarily interpreting Ghana’s recent macroeconomic improvements in the same way.
The Government’s own expectations have also evolved.
Finance Minister Dr Cassiel Ato Forson, speaking on Joy News’ PM Express programme on July 23, maintained that inflation would decline to 5 percent by December 2026, notwithstanding international geopolitical tensions.
At the PwC Ghana mid-year budget review webinar, the Finance Minister’s Technical Advisor, Dr Theo Acheampong, explained that the Ministry of Finance continued to expect inflation to finish the year within the eight per cent target, plus or minus two percentage points.
Dr Acheampong said the projection was informed by different economic scenarios and assessments undertaken by the Ministry.
Bank of Ghana’s position and the risks ahead
The central bank itself maintains an inflation target of eight per cent, with a tolerance band of 6–10 per cent. Its September Monetary Policy Report indicated that inflation was expected to move towards this band over the forecast horizon.
The BoG’s September Monetary Policy Committee assessment acknowledged that the risks to the inflation outlook were increasingly tilted towards the upside.
These included rising international crude oil prices, utility tariff adjustments, transport fare increases, geopolitical developments and possible adverse weather conditions associated with El Niño.
Nevertheless, the MPC considered that strong fiscal consolidation, improved food supplies and exchange-rate stability would help counter these pressures.
It also noted that core inflation had moderated to 4.2 percent in August, suggesting that underlying price pressures remained relatively contained.
The BoG’s October Investor Bulletin reiterated that the recent inflation increase reflected higher crude oil prices and other emerging pressures, while improved food supplies, fiscal consolidation and exchange-rate stability continued to provide some protection.
The IMF places greater emphasis on the benefits of fiscal consolidation, gold-export earnings and external-sector improvements. Fitch and IC Group place greater weight on the potential pass-through of higher energy costs, transport fares and exchange-rate movements.
Ultimately, the October and November inflation figures will provide an important test of these competing assessments.
For Ghana, the immediate policy challenge is to prevent the recovery in economic activity, higher energy costs and emerging domestic price pressures from reversing the substantial disinflation achieved over the preceding year.
By: Toma Imirhe / businesspostonline
