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Producer Price Inflation Edges Up Marginally to 1.9% in December 2025

Source: Life Pulse Daily | Date: January 22, 2026

Introduction

Understanding economic indicators is crucial for businesses, policymakers, and consumers navigating market volatility. The latest data from the Ghana Statistical Service (GSS) reveals a marginal increase in Ghana’s Producer Price Inflation (PPI) for December 2025. While the year-on-year rate rose slightly to 1.9%, the month-on-month figures indicate a deflationary trend in specific sectors. This article provides a comprehensive breakdown of these statistics, analyzing the impact on key industries and offering actionable advice for economic resilience.

Key Points

Background

Producer Price Inflation (PPI) measures the average change over time in the selling prices received by domestic producers for their output. Unlike the Consumer Price Index (CPI), which tracks prices paid by the end consumer, PPI tracks prices at the factory gate. It serves as a leading indicator of consumer inflation; rising producer costs often trickle down to retail prices, while falling producer costs can eventually lead to lower consumer prices.

In the context of the Ghanaian economy, the PPI is a vital metric for assessing the health of the industrial sector. It is calculated based on data from 175 items across three main sectors: Mining and Quarrying (weight: 43.7%), Manufacturing (weight: 35.0%), and Utilities (Electricity and Water). The GSS releases these figures monthly to provide stakeholders with insights into price dynamics across the supply chain.

Analysis of December 2025 Producer Price Inflation

The December 2025 report highlights a complex economic landscape where aggregate stability masks underlying sectoral shifts. The following subsections break down the data.

Year-on-Year (YoY) Performance

The year-on-year PPI stood at 1.9% in December 2025. This represents a 0.6 percentage point increase compared to the 1.3% recorded in November 2025. However, when compared to December 2024, the inflation rate is significantly lower by 24.2 percentage points. This suggests that while monthly pressures are building, the broader year-long trend indicates a cooling of inflationary pressures compared to the previous year.

Month-on-Month (MoM) Price Movements

On a month-on-month basis, the PPI recorded a -0.8% rate between November and December 2025. This negative rate implies that, on average, producers received 0.8% less for their goods and services in December compared to November. This deflationary pressure at the producer level could signal softening demand or reduced input costs in specific industries, potentially leading to stabilized consumer prices in the coming months.

Sectoral Breakdown

The aggregate figures conceal significant divergences between Ghana’s primary industrial sectors:

Mining and Quarrying

As the sector with the highest weighting (43.7%), Mining and Quarrying exerted a strong influence on the overall inflation rate. Inflation in this sector rose from 2.3% in November to 3.3% in December 2025, marking an increase of 1.0 percentage points. This surge is likely driven by global commodity price fluctuations and local operational costs.

Manufacturing

Conversely, the Manufacturing sector—which accounts for 35.0% of the PPI weights—saw a decline in inflation. The rate dropped from 0.5% in November to 0.1% in December 2025, a decrease of 0.4 percentage points. This marginal rise suggests relative stability in factory-gate prices for processed goods, potentially benefiting downstream consumers if these savings are passed on.

Transport and Storage

The Transport and Storage sub-sector continued to exhibit deflationary trends. Inflation in this area fell sharply from -10.2% in November to -3.7% in December 2025. A negative PPI in this sector indicates that transportation costs are decreasing year-on-year, which can help lower the overall cost of goods distribution if logistics efficiencies are maintained.

Practical Advice and Recommendations

Based on the data released by the Ghana Statistical Service (GSS), tailored recommendations have been issued to help different economic agents navigate the current pricing environment.

For Households and Consumers

To protect purchasing power amidst fluctuating producer prices, consumers are advised to:

• Adopt Value-Based Spending: Focus on essential goods and compare prices across different vendors. Use PPI trends as a guide; when producer prices are stable, it may be a good time to stock up on non-perishables.
• Shift Consumption Patterns: The GSS suggests adjusting consumption choices toward goods and services with historically stable prices. This helps insulate household budgets from sudden price shocks.
• Monitor Inflation Trends: Understanding that a drop in PPI often precedes a drop in CPI can help consumers plan major purchases.

For Businesses

Enterprises facing mixed sectoral pressures should consider the following strategies:

• Enhance Operational Efficiency: With manufacturing inflation remaining low (0.1%), businesses should focus on maintaining operational margins through cost-control measures and productivity improvements.
• Reinvest Savings: Where input costs (such as transport or raw materials) are decreasing, businesses are encouraged to reinvest the savings into innovation, skills development, and supply chain resilience rather than solely increasing profit margins.
• Supply Chain Optimization: Leverage the decline in transport and storage costs to optimize logistics and distribution networks.

For Government and Policy Makers

To sustain economic stability, the GSS recommends structural interventions:

• Reduce Structural Costs: Government intervention is needed to lower the cost of doing business. This includes strengthening the power supply, improving road infrastructure, and streamlining logistics programs.
• Support Key Sectors: Policies that support the Mining and Manufacturing sectors are crucial, given their heavy weighting in the PPI basket. Ensuring these sectors remain competitive will stabilize the broader economy.

Frequently Asked Questions (FAQ)

What is Producer Price Inflation (PPI)?

Producer Price Inflation measures the average change over time in the selling prices received by domestic producers for their outputs. It is a measure of price changes from the perspective of the seller, unlike the Consumer Price Index (CPI), which measures changes from the buyer’s perspective.

Why did the PPI increase to 1.9% in December 2025?

The increase to 1.9% was primarily driven by a sharp rise in the Mining and Quarrying sector, where inflation jumped to 3.3%. This increase outweighed the slight declines observed in the Manufacturing and Transport sectors.

What does a negative month-on-month PPI mean?

A negative month-on-month rate (-0.8% in this case) indicates that, on average, producer prices were lower in December compared to November. This can signal softening demand or lower input costs, which may eventually lead to stable or lower consumer prices.

How does this affect the average Ghanaian consumer?

While PPI affects producers first, it eventually impacts consumers. A stable or low PPI suggests that significant price hikes at the retail level are unlikely in the short term. However, the rise in mining inflation could eventually affect fuel and utility prices, which consumers should monitor.

Where can I access the official data?

The data is compiled and released by the Ghana Statistical Service (GSS). Detailed reports are typically available on their official website and through authorized media partners like Life Pulse Daily and MyJoyOnline.

Conclusion

The December 2025 Producer Price Inflation report paints a picture of an economy in transition. While the year-on-year rate of 1.9% reflects a marginal increase driven by the mining sector, the month-on-month deflation suggests underlying price corrections in other areas. For the Ghanaian economy, this mixed performance underscores the importance of strategic economic management. Households must remain vigilant with value-conscious spending, businesses must leverage efficiency gains, and the government must continue to address structural cost barriers. By understanding these dynamics, stakeholders can make informed decisions that foster resilience and growth.