Inflation as measured by the Ghana Statistical Services consumer price index hit dizzying new heights in March, as year-on-year (12 months) reached 29.9%.

The latest figures emanating from the Ghana Stock Exchange (GSE) have thus proved wrong the optimistic expectations of several senior government officials that February’s 29.4%inflation figure was an aberration resulting from arbitrary, but temporary price increases imposed by traders and commercial transporters in the wake of the near doubling of petroleum product prices announced at the end of January.

Prices for food items, which account for half of the weighted basket of items used to compute the CPI rose by 27.3% over the 12-month period while non-food items rose even faster, by 31.5% over the past one year. Altogether, prices as measured by the CPI rose by 2.5% in March alone, B&FT reports say.

Interestingly, petroleum prices and transport service costs did not contribute to the increase in inflation in March because prices in this sector had leveled out during the month.

However, the surge in overall price levels for the second month running indicates just how January’s petroleum price increases have reverberated around the entire economy. Inflation in both February and March is at its highest levels since September 2001. In March, food and beverage prices rose by 3.3% housing and utility prices by 5.9% recreation by 2.6% miscellaneous goods by 2.3% and alcohol and tobacco by 2.0%.

Rural areas were more adversely affected by accelerating inflation than urban areas. The rural price index, rose by 1.3%. However, prices in Accra rose faster than in other urban areas in the country; the Accra city price index rose by 1.9% in March.

A major contributor to inflation in March was electricity, the result of the upward adjustment in tariffs implemented at the beginning of the month. Electricity prices rose by 19.6% during the month. The inflation figures for March appear to indicate that accelerated price increases are not a one-off phenomenon caused by the increase in petroleum price tariffs after all.

In the 2003 budget, government has targeted an end of year inflation rate of 9.0%, in line with the requirement that all the five countries in the Second West Africa Monetary Zone are to achieve single digit inflation by the end of the year.