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Ghana PMI January 2020

Ghana: PMI dips in January

The Ghana Purchasing Managers’ Index (PMI) fell to 50.7 in January, from an 18-month high of 52.7 in December. Nevertheless, the index remained above the critical 50-threshold that separates improvement from deterioration in Ghanaian business conditions, where it has been for 16 consecutive months.

January’s moderation was largely driven by faltering new order growth, which slowed to a three-month low at the outset of the year, and a softer increase in output compared to December. That said, backlogs of work continued to rise solidly in January and, to cope with this, firms increased their staffing levels at the strongest rate in a year. On the price front, input prices increased markedly again in January, which triggered a significant jump in output prices. Lastly, business sentiment rose to a 12-month high in January, signaling healthy dynamics ahead.

Andrew Harker, Associate Director at IHS Markit, noted:

“The Ghanaian economy ticked along at the start of the year. While rates of growth in output and new orders came off the boil, this was probably to be expected given the strong monthly performance seen in December. Pleasingly, the rate of job creation quickened as firms responded to the solid inflows of new work seen in recent months. Firms will be hoping that the economy can build on solid foundations and have a positive year. IHS Markit is forecasting GDP to rise by 5.9% during 2020.”

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