The Institute of Statistical, Social, and Economic Research (ISSER) has said Ghana experienced its highest-ever inflation rate in twenty years in 2022.

According to its 2022 State of the Economy Report, ISSER said the year 2022 was characterized by unprecedented macroeconomic imbalances which generated uncertainties in the monetary and financial sector.

“Cumulatively, the influence of the food inflation component appeared more intense. Food inflation rates were largely driven by four food subgroups; water; milk, other dairy products, and eggs; sugars, confectionery, and desserts; and fruits and vegetable juices,” it stated.

In 2022, Ghana’s inflation kept rising till it hit its highest of 54.1% in December. Inflation was caused by various factors including Ghana’s high debt levels and the constant depreciation of the cedi.

The government attributed this to the Russia-Ukraine conflict and the COVID-19 war.

ISSER in its report added that due to the persistent inflation, the Monetary Policy Committee of the Bank of Ghana unusually increased the policy rate four times within 2022.

The monetary policy rate in 2022 was increased to 27% as of the end of December 2022.

ISSER stressed that the instability of interest rates of deposit money banks (DMBs) can partly be attributable to the high rate of inflation and the subsequent adjustments in the policy rate.

SSD/NOQ

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