Ghana’s private sector stalled in May as business activity dipped slightly, though firms hired at the fastest pace in almost a year, a closely watched survey shows.
The S&P Global Ghana Purchasing Managers’ Index (PMI) came in at exactly 50.0 in May, down from 50.3 in April. A reading of 50 signals no change, ending two months of improvement. The data, drawn from about 400 private firms, were collected between May 12 and 27.
New orders rose for a fourth straight month, although at the softest pace since February, as stronger customer demand and better material availability lifted sales. Output edged down fractionally, with some firms citing customers’ difficulty financing projects, but the fall was smaller than in April.
The standout was employment, which grew at its sharpest rate in nearly a year. Firms said the extra staff, combined with slower order growth, let them clear backlogs of work. They also trimmed purchasing and stocks of inputs, judging existing supplies sufficient.
On prices, input costs rose for a second month, which firms linked to higher fuel costs and a weaker cedi, and they passed some of this on through modestly higher selling prices. Even so, the survey said inflation stayed muted. Suppliers’ delivery times shortened, the most in four months.
Business optimism about the year ahead slipped to its lowest in just over a year but stayed above the survey’s long run average. Andrew Harker, Economics Director at S&P Global Market Intelligence, said the month’s main positive was the jump in hiring, with “expanded capacity hopefully helping to boost output in the months ahead.”
