The Bank of Ghana’s updated Composite Index of Economic Activity (CIEA) recorded a strong annual growth of 33.1%in May 2021, relative to the contraction of 10.2% percent recorded in the corresponding period of 2020.

The sharp increase broadly reflects some base-drift effects as well as improvement in industrial production activities, domestic consumption, pick up in import activities, steady rise in construction activities and a rise in air-passenger arrivals, during the period.

Also, the Ghana Purchasing Managers Index, which gauges the rate of inventory accumulation by managers of private sector firms and measures dynamics in economic activity, pointed to some sustained levels of business activity in June 2021.

However, the latest confidence surveys by the Bank of Ghana reflected mixed sentiments.

While, consumer sentiments softened on the back of a variety of factors including the implementation of the recently announced revenue measures contained in the 2021 Budget, business sentiments remained somewhat broadly unchanged due to expectations of improvement in company growth prospects.

Meanwhile, current developments indicate moderation in price pressures during the second quarter of 2021.

Two readings since the last MPC meeting showed significant decline in headline inflation from 10.3% in March 2021 to 7.5% in May 2021, before ticking up to 7.8% in June 2021.

This trend has pushed down inflation to below the central path of the medium-term target band.