Ghana: Improvement in operating conditions strengthens at the start of 2021
February 3, 2021
The IHS Markit Ghana Purchasing Managers’ Index (PMI) bounced back from 50.3 in December 2020 to 51.2 in January. Thus, the index remained above the neutral 50-threshold that separates improving from deteriorating conditions in the private sector compared to the prior month.
The upturn at the start of 2021 was primarily driven by solid increases in business activity and new orders amid the reopening of schools after they were shut down for nine months due to the pandemic. Moreover, in line with increased workloads, firms continued to hire workers, with employment growing for six consecutive months in January. Turning to prices, input cost inflation rose to its highest since June 2015 amid higher purchase and labor costs, which led firms to raise selling charges for the ninth successive month. Lastly, business sentiment was largely stable from December, on hopes of higher output ahead.
Author: Javier Colato, Economist