Ghana's inflation rate eased to 3.8 per cent year-on-year in January, extending its disinflation streak to 13 consecutive months and strengthening signs of price stability in the West African economy, even as neighbouring Nigeria eyes a single-digit inflation figure.
Fresh data released on Wednesday by the Ghana Statistical Service (GSS) showed inflation fell sharply from 5.4 per cent recorded in December, driven largely by a significant slowdown in food prices.
The latest reading marks Ghana's lowest inflation level since the country rebased its Consumer Price Index in 2021 and represents a dramatic turnaround from the acute inflation crisis that rocked the economy just two years ago.
By contrast, Nigeria, ranked as West Africa's largest economy, is still grappling with elevated price pressures fuelled by currency depreciation, high energy costs, food supply disruptions and structural bottlenecks, leaving households under persistent cost-of-living strain.
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Ghana's Inflation decline linked to food prices
Government Statistician, Alhassan Iddrisu, said the January outcome reflects a broad-based moderation in prices across major components of the consumer basket.
Food inflation, which has historically been the biggest driver of headline inflation, slowed to 3.9 per cent, contributing most to the 1.6 percentage-point drop recorded in January.
"The sustained decline signals that Ghana is firmly on a path towards price stability," Iddrisu said.
Ghana's recent progress follows a turbulent period marked by macroeconomic instability.
Inflation surged in the aftermath of the COVID-19 pandemic and worsened through 2022 amid sharp currency depreciation, rising public debt and mounting fiscal pressures. Prices peaked at a record 54.1 per cent in December 2022, eroding purchasing power and triggering widespread hardship.
The crisis forced the government to default on parts of its sovereign debt and embark on both domestic and external debt restructuring, alongside a three-year support programme with the International Monetary Fund (IMF).
Since then, tighter monetary policy, fiscal consolidation and improved exchange rate stability have helped reverse inflationary pressures and restore investor confidence.
Nigeria's contrasting picture
While Ghana's inflation now sits comfortably below the Bank of Ghana's 8 per cent target band, Nigeria continues to contend with elevated consumer prices that remain in double digits, reflecting ongoing structural and monetary challenges.
Analysts say Ghana's inflation number is hinged on the fact that prices are significantly lower, contending that this also reflects the impact of fiscal reforms and coordinated monetary tightening.
Speaking with Daily Trust, a Professor of Economics, Ndubisi Nwokoma stated inflation figure is determined by significant changes in prices of goods in the basket.
Daily Trust reports that the Central Bank of Nigeria (CBN) in its 2026 economic outlook projected headline inflation to moderate sharply to an estimated average of about 12.94 per cent in 2026, driven by declining food prices and lower premium motor spirit, PMS, costs.
The Bank expressed optimism that sustained reforms and improved supply conditions would help anchor inflation expectations.
Currently, Nigeria's inflation rate stands at 15.5 per cent in December 2025; higher than 14.45 per cent reported in November but the adjustment in the Consumer Price Index (CPI) increased the figure to 17.33 percent.
However, in a chat with our correspondent, the economist said, "When you talk about inflation, you talk about the changes in general price level and when you talk about these changes, you always have a basket of changes across sectors. So it is not all commodities but baskets. So what the figure would be would depend on the basket you make up. The critical thing is the change in prices of goods in that basket.
"So being 15 or being 3 depends on the change, not the quantum. So that Ghana has about three per cent means the changes are small in price level of yesterday and that of today. But 15 means the changes are significant. It is the changes in the general price level. The critical thing is about methodology and the rate of change of those prices which are caused by other macroeconomic indicators. So if the changes are very small in Ghana, it means the price increase is not significant compared to Nigeria and that would also depend on what methodology you are using."
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He stated that based on the target of the Nigerian government, single-digit inflation is achievable in Nigeria but this does not mean Nigerians are better off in terms of welfare.
"Government can always deceive us or deceive itself by changing the methodology or doing rebasing. So depending on the methodology used, the figure will always change. If they want it to be like that of Ghana, they can play around with the figure and bring it to be like that of Ghana. But if you use similar commodities in a basket, that is when we can really compare Nigeria and Ghana," he stated.
