Producer Price Inflation drops to 24.4% in March 2025 but industry leaders warn of utility cost pressures

Ghana’s Producer Price Inflation (PPI) declined to 24.4 percent in March 2025, marking a 3.2 percentage point drop from the 27.6 percent recorded in February.

This is according to provisional data released by the Ghana Statistical Service (GSS), which also reported a modest month-on-month increase of 0.6 percent between February and March.

The data reveals that the Mining and Quarrying sector, despite a notable decrease from the previous month’s 43.7 percent, still posted the highest inflation rate at 35.4 percent. Manufacturing followed with an inflation rate of 22.8 percent, a rise from February’s 20.8 percent.

On the lower end, the Information and Communication sector recorded the lowest inflation at 4.1 percent, a marginal dip from the previous month’s 4.2 percent. Other sectors saw modest changes, with Construction falling slightly to 15.4 percent from 15.8 percent, and Accommodation and Food Services dropping to 7.2 percent from 7.8 percent.

The PPI serves as a key indicator of the average change over time in prices received by domestic producers for their output. It covers major sectors including Mining and Quarrying, Manufacturing, Electricity and Gas, Water Supply, Construction, Transport and Storage, Accommodation and Food Services, and Information and Communication.

Despite the downward trend in producer inflation, concerns have been raised over rising utility costs. Tsonam Akpeloo, Greater Accra Regional Chairman of the Association of Ghana Industries (AGI), cautioned that recent hikes in electricity and water tariffs could undermine the progress made in inflation reduction.

Under the new tariff adjustments, electricity costs are set to increase by 14.75 percent, while water tariffs will rise by 4.02 percent.

“We urge the government to prioritize local industrialization and create special tariff arrangements that significantly reduce electricity costs for manufacturers. Otherwise, the benefits of the declining inflation rate may be short-lived,” he said.

Akpeloo further emphasized: “If utility prices continue to rise, the overall cost of production will remain high, offsetting the positive effects of a falling PPI. All these prices are interlinked, and without addressing utility costs, inflation gains may not translate into real industrial competitiveness.”

As producer inflation eases, stakeholders are urging policymakers to implement complementary measures to protect industrial productivity and ensure the country’s manufacturing sector can fully capitalize on the easing price pressures.