Sept. 14 (Bloomberg) -- Ghana’s inflation rate was unchanged in August as better food harvests damped price pressures, while electricity costs increased, giving the central bank room to keep its key interest rate on hold.
Inflation stayed at 8.4 percent in July, Grace Bediako, a statistician at the Ghana Statistical Service, told reporters in the capital, Accra, today.
“Ghana’s buffer-stock system and subsidized fertilizer for farmers has reinforced the impact of the food harvest at this time,” Sampson Akligoh, an economist at Accra-based Databank Financial Services Ltd., said in a telephone interview yesterday.
The Bank of Ghana left its key interest rate unchanged at 12.5 percent for the first time in three meetings, concerned about rising electricity and water costs. The bank had lowered the rate twice this year as inflation eased.
The bank may keep the policy rate on hold again at its next decision meeting, as higher utility price and raises for public- sector workers may add pressure on the inflation rate, Akligoh said.
The state-owned National Food Buffer Stock Co. was created last year to buy excess crops from farmers, while the government said in July it would spend $22 million on fertilizer subsidies.
Ghana’s inflation rose to a five-year high of 20.7 percent in June 2009 as food prices climbed and the cedi depreciated by 17 percent against the dollar. Prices eased over the next 18 months before a 30 percent increase in petroleum costs pushed the rate to 9.2 percent in February from 9.1 percent a month earlier.
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