BoG composite index of economic activity rises, but Ghana purchasing managers’ index falls

The Bank of Ghana’s updated Composite Economic Activity Index (CIEA) for July 2021 reflects the continued upturn in national economic activity.

According to the Central Bank, the real CIEA grew 20.0% year-on-year in July 2021, up from 20.2% in June 2021, and 3.9% growth in July 2020.

Growth in indicators, according to the Central Bank, was somewhat generalized, with port activity, imports, domestic VAT and air passenger arrivals accounting for the increase.

But Ghana’s purchasing managers’ index fell in August 2021 mainly due to rising input costs. The decline in the Purchasing Managers’ Index, according to the Bank of Ghana, was in line with the results of the Bank’s latest confidence surveys, conducted in August 2021, which indicated some easing in corporate sentiment.

The results of the survey revealed the inability of companies to meet their short-term goals due to high input costs, unavailability of raw materials, low consumer demand and rising labor costs. -work. However, consumer confidence has improved, reflecting optimism about current and future economic conditions.

In addition, the pace of growth in total liquidity moderated in August 2021. Broad money (M2 +) increased, year-on-year, by 20.2% in August 2021, compared to growth of 24. 8% recorded in August 2020.

The slowdown in growth, according to the Central Bank, is due to a contraction in the net foreign assets (NEA) of the banking sector. Reserve currency, on the other hand, increased significantly by 36.7%, compared to 20.2% during the same comparative period, largely reflecting the net accumulation of the Bank’s foreign exchange reserves, purchases cocoa rates higher than expected and the continued implementation of COVID-related measures. policy measures.

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