Ghana PMI September 2018


Ghana: PMI slips into negative territory for the first time in over two-and-a-half years in September

October 3, 2018

The Stanbic IBTC Bank Ghana Purchasing Managers’ Index (PMI) fell to 49.2 points in September, from 51.8 points in August. As a result, the index slipped below the critical 50-point threshold that separates improvement from deterioration in business conditions in Ghana for the first time since January 2016.

The deterioration came largely on the back of lower output and shrinking new orders in September. Following 23 months of sustained growth, output fell markedly in September, reportedly as a result of the weakening Ghanaian cedi. New orders, meanwhile, contracted for the first time in nearly three years in September, amid higher output prices due to increased input costs which stemmed from higher fuel costs and the exchange rate weakness. On a slightly more positive note, job creation picked up pace in the surveyed month, with backlogs of work recording a slight increase.

Commenting on the report, Andrew Harker, an associate director at IHS Markit, noted:

“Declines in output and new orders in September end a successful period in the Ghanaian economy, and as has been the case in the past are closely linked to currency weakness [...] Given the recent good performance of the economy IHS Markit forecasts GDP growth of 8.9% in 2018, but should September's data be the start of a downturn there are downside risks to this outlook.”

Ghana Fixed Investment Forecast

FocusEconomics Consensus Forecast panelists expect fixed investment to expand 7.5% in 2018 and 6.3% in 2019, which is unchanged from last month’s estimate.

Author:, Research Team Manager

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