Associate Professor of Finance at Andrews University, USA, Prof Williams Peprah, has cautioned that Ghana could risk deflation if the government continues its aggressive approach to reducing inflation.

His remarks follow official data showing that Ghana’s year-on-year inflation rate fell to 3.3 per cent in February 2026, marking the 14th consecutive monthly decline and the lowest level recorded since the 2021 rebasing of the Consumer Price Index (CPI).

Speaking on Joy News’ The Pulse on Wednesday, 4 March, Prof Peprah noted that while the rapid reduction in inflation is commendable, an overly aggressive approach could push the economy toward deflation — a scenario he warned against.

He compared the current monetary policy strategy with that of previous administrations, including the New Patriotic Party (NPP), which had used tighter policy rates but implemented gradual reductions.

“During the NPP’s time, the monetary policy rate came down at a slower pace, and it carried costs. The current government, however, has adopted a more radical, accelerated approach to address inflation and stabilise the exchange rate quickly,” he said.

Prof Peprah highlighted that although the measures have successfully reduced inflation below the threshold, some regions — including Savannah, Oti, and Upper East — have already begun experiencing deflation.

“Inflation has now gone below our threshold, so the government should slow down on this aggressive approach. If not, we risk slipping into deflation — something we do not want,” he warned.

He emphasised the need for a balanced approach that supports economic stability without triggering unintended negative consequences.

“Deflation can have serious consequences for businesses and households. We must find ways to manage these concerns while consolidating the progress made,” he added.