The rising inflation could ease in July 2023 but the simmering food price pressures pose a threat, GCB Capital has indicated.

In a report titled: “Policy Insights: Ghana’s June -23 Inflation Update”, it, however, said the continuous decline in non-food inflation may not be enough to bring inflation down.

“While the disinflation process could resume in July 2023, the food basket remains a significant source of price pressure”.

“We expected the waning lagged impact of the revenue and utility tariff measures and the favourable base effects to reset inflation on the downward path from July 23 and reinforce low inflation expectations, all things being equal. We flag the simmering food price pressures as a near-term upside risk to inflation, which could moderate the pace of disinflation”, it added.

While the Personal Care & Miscellaneous Goods; Furnishing & Household Equipment; Housing & Utilities and the Alcoholic Beverages & Narcotics Divisions continue to record inflation rates higher than the national average, the disaggregated data shows inflation is easing across these divisions. Their contribution to the overall inflation print is also continuously declining, underscoring the continued decline in non-food inflation.

Year-on-year inflation climbed for the second consecutive month since May 2023, rising to 42.5% in June 2023.

The June 2023 inflation continued the reversal in the inflation trend, albeit at a moderated pace, after four consecutive months of disinflation from the start of 2023.