Inflation Begins 2026 at a Multi-Year Low

The ongoing relative price stability, with the headline inflation outlook appearing tamed, improved further at the start of the new year as the inflation rate decelerated yet again in January to a multi-year low. According to data released by the Ghana Statistical Service (GSS), both the headline and month-on-month inflation prints decelerated in January, with the headline inflation rate coming in at 3.8%, down from 5.4% at the close of last year, while that of the monthly inflation change rate came in at 0.2%, down from 0.9%. The steady drop in the successive inflation numbers to a 3.8% in January 2026 from 23.5% over the same period last year shows a sustained shift in prices, signaling that Ghana is firmly on the path to macroeconomic stability.

The deceleration in the consumer price index and the subsequent sharp decline in inflation numbers have largely been sustained by a tight fiscal discipline, the Cedi’s record run, and a slump in fuel and transport prices over the past year, among others. The drop in January’s inflation rate was sustained by price decreases in some key consumer items such as transport fares and cereal products, whilst some others recorded minimal changes. The data from the GSS further revealed that a significant portion of items with the lowest inflation rates were food items as garden eggs, fried fish, and cocoyam leaves, with deflation rates of 58.7%, 50.7%, and 49.1%, providing some relief to consumers.

Food inflation lowered from 4.9% at the close of last year to begin the new year at 3.9% as thirteen out of the observed fifteen sub-group items recorded decreases in their respective inflation numbers from the previous month. Month-on-month food inflation picked up marginally in January at 1.13%, up from 1.09% in December as price decreases in some items such as Fruit & vegetable juices (-0.7%) and fish & seafoods (-0.6%), were offset by price increases in some items such as Fruits & nuts (+6.6%) and vegetables, tubers & plantains (3.0%).

Non-food inflation, on the other hand, recorded significant drops in both the year-on-year and month-on-month inflation readings, edging down from 5.8% and 0.6% to 3.9% and -0.4%, respectively. Transport remained the only item in this inflation basket that recorded a price decrease over the past year, whilst extending its deflationary path for the eighth consecutive time. Some other items, such as clothing & footwear, alcoholic beverages, personal care & miscellaneous goods, and housing & utilities, recorded price decreases in the month of January.

Across the regions, the inflation rate hovered between 2.6% in the Savannah region and 11.8% in the North East region. Inflation on both local and imported items stayed on their declining path, lowering from 5.9% and 4.3% in December to print at 4.5% and 2.0%, respectively. Similarly, inflation on the goods and services categories recorded decreases, down from 5.8% and 4.5% in December last year to 3.6% and 4.0%, respectively.

In line with expectations, the first monetary policy committee sitting of the Bank of Ghana in 2026 saw the committee slash the policy rate by 2.5 percentage points from 18.0% to 15.5% as the latest forecast and six-months ahead survey-based inflation expectations indicated that headline inflation is broadly anticipated to be within the medium-term target band.