Ghana: Improvement in operating conditions eases in December
January 7, 2021
The IHS Markit Ghana Purchasing Managers’ Index (PMI) dropped to 50.3 in December from 52.5 in November, marking the lowest print in five months. However, the index remained above the neutral 50-threshold that separates improving from deteriorating conditions in the private sector economy compared to the prior month.
The downtick at the close of the year came on the back of weaker growth in output and new orders as the country’s elections sparked a pause in business activity. That said, anecdotal evidence points to firming demand and, as such, these subcomponents are expected to continue expanding in the months ahead. Furthermore, job creation continued apace as staff levels rose at the quickest, albeit still modest, pace since the coronavirus crisis began. However, backlogs of works increased marginally and in part due to supply-side issues, linked to raw material shortages. Turning to prices, input prices rose at the quickest pace in four months, and this was passed on to consumers as output prices increased at the sharpest rate since April 2019. Lastly, business sentiment rose on the hopes of an improved business climate in 2021.
Author: Jan Lammersen, Economist