Ghana: Economy Managers Advised to Use Gold to Control Rising Inflation – Jantuah
Energy Expert Mr Kwame Jantuah has suggested to the managers of the Ghanaian economy to use gold to control inflation in the country.
The former Vice President of the Public Interest and Accountability Committee (PIAC) said this whiles speaking on the increment of the Policy Rate by the Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) from 22 per cent to 24.5 per cent.
He said “Gold is a good commodity for hedge of inflation. Are we the first largest producer of gold in Africa? How have we used gold to shore and hedge inflation.”
Meanwhile, the Bank of Ghana (BOG) launched its Central Bank’s Domestic Gold Purchasing programme in June 2021 with the primary objective of increasing its gold reserves.
Subsequently, the BoG initiated discussions with the Ghana Chamber of Mines (GCM) about its intention to purchase refined gold from mining companies in the country.
Regarding inflation, at the MPC press conference in Accra on Thursday October 6, Governor of the Bank of Ghana Dr Ernest Addison said results from the Bank’s August 2022 confidence surveys showed further softening of Business and Consumer sentiments.
While consumer confidence dipped on account of rising inflation, business sentiments softened on the back of concerns about price pressures, currency depreciation, and weakening consumer demand.
The survey findings were broadly in line with an observed downturn in Ghana’s Purchasing Managers’ Index (PMI) in August 2022.
“Price pressures have remained elevated. The latest reading indicated that headline inflation accelerated to 33.9 percent in August 2022, from 31.7 percent in July and
29.8 percent in June.
The rise in the August inflation was broad-based, driven by both food and non-food prices. Food inflation rose to 34.4 percent from 32.3 percent in July, whereas non-food inflation jumped to 33.6 percent from 31.3 percent, over the same comparative period. The upturn in food and non-food inflation was influenced by prices of both local and imported components in the consumer price basket.
“In line with these trends, underlying inflation pressures remained heightened. The
Bank’s core inflation measure, which excludes energy and utility, increased further to
32.6 percent in August, from 30.2 percent in July 2022. Similarly, all the other core
measures of inflation rose, reflecting the generalised increase in price levels.
“The Bank’s latest surveys showed increased inflation expectations across consumers,
businesses, and the financial sectors. Notwithstanding the above trends, monthly inflation has declined for four consecutive months, reflecting a slowdown in the rate of increase in inflation.”