Ghana inflation rises to 9.5 pct in July

ACCRA (Reuters) - Ghana's annual inflation rose to 9.5 percent in July from 9.4 percent the previous month due to pressure on the local cedi currency, Ghana's statistics office said on Wednesday, but the rise was slower than expected by analysts.

The rise in consumer inflation is the fifth in a row, highlighting price pressures in the West African nation's economy.

Ebo Duncan, Ghana's director of economic statistics, pinned the inflation increase on the depreciation of the cedi against the dollar which contributed to the inflation rate in imported food items.

"The exchange rate depreciation has made some imported foods more expensive and their weight on inflation is huge," he said.

Yvonne Mhango, Sub-Saharan Africa economist at Renaissance Capital, said the increase in inflation was "very modest" given the cedi had depreciated by 29 percent against the greenback in the year to July.

Harvests in coming months should ease food inflation but spending linked to an election due in December posed a risk.

"We expect inflation to be in the early double-digits at (the end of 2012)," Mhango said, adding that any further slip by the cedi was likely to lead to a rate hike in September.

"If the cedi exhibits further weakness in the following weeks, the MPC meeting may be compelled to take action and hike by about 50 basis points," she said.

Source: http://news.yahoo.com/ghana-inflation-rises-9-5-pct-july-stats-102529687--business.html

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