The Bank of Ghana has pointed out that its updated Composite Index of Economic Activity (CIEA) shows that the observed strong growth momentum will likely persist in the first quarter of 2022.

According to the Central Bank, the CIEA recorded an annual growth of 4.6% in March 2022, compared to 4.2% and 4.4% in January and February 2022, respectively.

Available data also showed that exports are picking up, whilst credit to the private sector continues to recover, together with an uptick in industrial production.

The Central Bank explained further that the improvement in Domestic VAT suggests demand is picking up, and higher tourist arrivals have also been recorded, adding, “these were the variables that drove the rise in the index.”

On the domestic front, data from the Ghana Statistical Service showed that the economy has rebounded strongly from the impact of the COVID-19 pandemic, stemming largely from all the policy measures that were put in place to forestall a recession.

This is evidenced by the strong real GDP growth outturn of 5.4% reported for 2021, compared with 0.5% in 2020. Non-oil GDP grew at a stronger pace by 6.9% in 2021, significantly up from 1.0% in 2020. The strong pick-up in economic activity, was largely driven by the services and agriculture sectors.

Consumer, business confidence softens

The Bank of Ghana also said its latest confidence surveys conducted in April 2022, showed some easing of sentiments.

Consumer confidence dipped on account of increases in fuel prices and transportation costs, as well as rising inflation.

Again, business sentiments also dipped on concerns that price pressures and currency depreciation would adversely impact industry prospects.

The survey findings were broadly aligned with observed trends in Ghana’s Purchasing Managers’ Index (PMI), which reflected declines in both output and new orders.