Ghana has recorded a 39% decline in total credit flows, falling to GHS8.6 billion in August 2025 from GHS14.2 billion in the same month last year.

The drop, highlighted in the Bank of Ghana’s September 2025 Monetary Policy Report, was mainly attributed to reduced lending to the public sector and a slowdown in private sector credit as banks redirected their portfolios toward government and Bank of Ghana securities.

Private sector credit flows stood at GHS10.7 billion in August 2025, down from GHS14.3 billion a year earlier. Despite the decline, the private sector remained the dominant recipient of credit, accounting for 95.5% of total outstanding loans compared to 92.7% in August 2024.

Credit distribution was concentrated in the services sector, which absorbed 68.2% of total loans, followed by commerce and finance with 23.8% and manufacturing with 23.0%.

Outstanding private sector credit increased to GHS91.0 billion at the end of August 2025, up from GHS80.3 billion a year earlier. In real terms, private sector credit grew by 1.7%, reversing the 1.1% contraction recorded over the same period in 2024.

According to the central bank, the growth in real private sector credit was slightly above the long-term trend, with the deviation from trend widening marginally in August 2025.

On the contrary, Ghana’s year-on-year Producer Price Inflation (PPI) for all goods and services saw a slight increase in September, marking a 0.2 percentage point rise from the 3.0% recorded in August 2025, the Ghana Statistical Service has reported.

The Statistics Authority said the September PPI stood at 3.2%. Despite the slight increase, it marks a sharp decline of 27.3 percentage points compared to September 2024, when producer inflation was significantly higher.

On a month-on-month basis, producer prices rose by 0.9% between August and September 2025, meaning that, on average, producers received 0.9% more for their goods and services than they did the previous month.

The Mining and Quarrying sector, which forms the largest part of the index with 43.7%, saw a modest uptick in its inflation rate from 4.9% in August to 5.0% in September.

Similarly, Manufacturing, which accounts for 35% of the PPI weights, recorded a modest increase from 1.6% to 1.7% over the same period, marking a 6.25% rise.

However, Transport and Storage prices continued to decline, with inflation in the sector dropping by 8.2% in September compared to a fall of 8.0% in August 2025.

The GSS urged businesses to cut waste, improve efficiency, and reinvest savings in technology and skills development to stay competitive amid fluctuating prices. It further encouraged firms to transform inflationary pressures into productivity gains.

The agency also advised the government to prioritise tax reliefs, address energy and transport bottlenecks, and strengthen local supply chains to make production cheaper and more efficient.

For households, the GSS recommended smart spending habits, urging consumers to compare prices, buy wisely, and support businesses that pass on cost savings.

“Spend with intention to stretch income and reward fair pricing,” the Service advised.

Meanwhile, Ghana’s Producer Price Inflation (PPI) for June 2025 saw a sharp decline of 5.9%, marking the lowest level since November 2023, according to the Ghana Statistical Service (GSS).

Presenting the data in a press briefing held on Wednesday, July 16, in Accra, Government Statistician Dr. Alhassan Iddrisu indicated that for June alone, there was a deflation of 1.4%, meaning that, on average, producers earned less money for their products than they did in May.

This comes after a drop of 4.2 percentage points, given the 10.1% rate recorded in May, indicating a significant decrease of 19.7 percentage points compared to June 2024, when it stood at 25.6%. This marked the fifth consecutive month that the PPI had gone down.

“Ghana Producer Price inflation fell sharply to 5.9% in June 2025, down from 10.1% in May, a 42 percentage point dip in just a month, marking the fifth straight month of decline and the lowest rate since November 2023,” he announced.

Dr. Alhassan Iddrisu attributed the decline to the mining and manufacturing sectors, along with the transport and hospitality sectors.

The mining and quarrying sector, Ghana’s largest contributor to the PPI with a 43.7% weight, saw inflation fall from 13.7% in May to 6.5% in June. Manufacturing, which contributes about 35% of the PPI basket, dipped from 9.8% to 7.6%.

Meanwhile, inflation for September 2025 dropped to 9.4% from 11.5% in August this year, according to the Ghana Statistical Service (GSS).

This marks the ninth consecutive month of decline since October 2021. The GSS attributed the latest development to the slowdown in food price increases. As of June, the country recorded a 13.7% rate, a 4.7 percentage point decline from the 18.4% rate reported in May.

Food inflation fell by 6.5 percentage points to 16.3%, down from 22.8% in May, whereas non-food inflation dropped by 3 percentage points to 11.4%.

The Upper West Region recorded the highest regional inflation of 32.3%, largely due to food inflation and utilities. The Bono Region recorded the lowest at 8.4%.

On a regional level, the Upper West Region once again recorded the highest inflation at 24.8%, though this was down from 32.3% in June. This figure is more than twice the national average of 12.1%. In contrast, the Central Region posted the lowest rate at 7.7%.

Before the release of the GSS’s recent data, an economic research firm, IC Research, projected that Ghana’s inflation rate would experience a significant decline, dropping to 16% by the end of June. According to IC Research, the projected improvement is partly driven by the appreciation of the local currency and a reduction in fuel prices, both of which are easing inflationary pressures.

“The June 2025 CPI data window recorded a 29.5% month-on-month and 35.3% year-on-year appreciation of the Ghanaian cedi against the US dollar. This exerted downward pressure on prices of imported items, with notable declines in petroleum prices and transport fares. The announced 15.0% reduction in commercial transport fares will continue to restrain transport inflation with downside spillovers for other items.

“Additionally, we estimate that the lower transport cost likely eased the month-on-month pressure observed for vegetables and tubers last month, potentially sustaining food disinflation in June 2025. Consequently, we forecast a 240 basis point decline in the June 2025 annual inflation to 16.0%, with the month-on-month rate at 0.8%,” IC Research added.

Ghana ended the year 2024 with 23.8% inflation. In January 2025, inflation slightly declined to 23.5%, and since then, it has continued to ease. In February, inflation declined to 23.1%; it saw another decrease in March to 22.4%, and declined again in April to 21.2%.

Due to the consistent decline in the inflation rate and recorded progress with other macroeconomic variables, the Bank of Ghana’s (BoG) Monetary Policy Committee has reduced the monetary policy rate from 28% to 25%.

Governor of the Bank of Ghana, Dr. Johnson Asiama, noted that the deceleration was underpinned by the tight monetary policy stance, fiscal consolidation, easing food supply constraints, as well as the strong recovery of the cedi.

The Bank of Ghana has projected that headline inflation will fall within its medium-term target of 8 ± 2% by the end of 2025.

The Central Bank attributed this expected decline to tighter monetary policy, the strengthening of the cedi, and continued fiscal consolidation efforts.

It added that supply-side pressures have eased, resulting in lower food and overall inflation, with risks now tilted to the downside.

Nonetheless, the Bank warned that some upward risks persist, including supply chain disruptions, global trade tensions, a 2.5% increase in utility tariffs, and a new 1.0% energy levy on ex-pump prices, which could push inflation up.