*BoG’s CIEA records 26.8% YoY growth in 2021
Composite Index of Economic Activity (CIEA) of the Bank of Ghana (BoG) has at the end of March 2021 recorded a 26.8% growth year on year.
The record growth in the CIEA, the Central Bank further notes is a rebound from the 1.9 percent contraction recorded same period last year.
On a quarter-on-quarter basis, the CIEA recorded a 14.4 percentage points growth from 12.4 percent in February 2021 to 26.8 percent in March 2021.
The year-on-year and quarter-on-quarter increment in the BoG’s CIEA which measures changes in economic activities indicates a pick up in economic activities and the gradual recovery of the economy from the Covid-19 pandemic.
Key drivers of economic activities for the period under review according to the Central Bank were domestic consumption (proxied by VAT collection), construction activities, international trading activities, resumption of industrial production activities and air-passenger arrivals into the country.
Despite the recorded growth in the CIEA, the BoG’s latest confidence surveys conducted in April 2021, showed a decline in both consumer and business sentiments.
According to the Central Bank, consumer confidence dipped slightly on account of recent increases in petroleum prices at the pump, new taxes, and transportation
In a similar direction, the optimism of businesses also declined or softened on concerns that the imposition of new taxes as announced in the 2021 Budget statement and the ongoing electricity maintenance management programme would adversely impact operational costs in the short-term.
But according to Dr Ernest Addison, Governor of the Central Bank, softened or dampened consumer and business confidence sentiments are temporary and expected to improve in the near-term.