NewsWest AfricaGhana Central Bank Governor refutes Bawumia inflation claims

Sun,23Nov2014

Posted on Thursday, 10 May 2012 16:21

Ghana Central Bank Governor refutes Bawumia inflation claims

By Lawrence Quartey

Ghana has refuted claims by a former deputy governor of its central bank that its inflation figures are flawed.

Map of GhanaMahamudu Bawumia who is now the vice presidential candidate for the opposition New Patriotic Party (NPP) said the country's single digit inflation figures were not consistent with economic fundamentals.

The statement generated heated debate with officials from the ruling National Democratic Congress and the NPP engaged in a media battle over the statistics.

Philomena Nyarko, the acting chief statistician in the Ghana Statistic Service described Bawumia's statement as "unfortunate."

She said the country had not changed the way it calculated its inflation rate.

"We would like to remind him that it is the same institution that computed the GDP figures he used to judge the good performance of the economy between 2000 and 2008," she said.



"It is also the same GSS that computed the GDP figures that showed the declining growth in agriculture in 2011, which he referred to in his speech.

"

GSS has always subscribed to internationally accepted principles and ethics in the production of quality statistics," she noted.



She said computing price changes over a time interval is not consistent with the standard procedure for calculating inflation and is misleading.



Nyarko said it would be wrong for one to use only few items in few selected locations as an indicator of the change in the general price levels.

She also questioned the link drawn between the price of cement and inflation, noting that cement was not in the consumer basket.

But its influence on the consumer price index could be felt through rent which is in the basket.



Bawumia said the effect of the depreciation of the cedi was reflected in the inflation rate of imported food items.

Available data shows imported food inflation has been consistently higher than local food inflation.



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