Ghana well-positioned to absorb global shocks – Dr Ato Forson

Ghana's Minister of Finance, Dr Cassiel Ato Forson, is optimistic that the country's inflation rate will remain below 5% by the end of 2026, despite rising geopolitical tensions in the Middle East and their potential impact on global energy and commodity prices.

His projection comes after Ghana's disinflation trend slowed in April, with headline inflation rising marginally to 3.7 percent in May from 3.4 percent in April, marking the first increase after 15 consecutive months of declining price pressures.

Despite the recent uptick, Dr Forson maintained that the inflation trajectory remains within the Bank of Ghana’s medium-term target band of 8 percent, plus or minus 2 percentage points.

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Speaking in an interview with Bloomberg, the Finance Minister acknowledged that the conflict in the Middle East presents risks to Ghana’s inflation outlook, particularly through higher fuel and fertiliser prices and potential disruptions to global supply chains.

“The conflict poses risk on the price of petroleum products and then impacts, most importantly, fertiliser and supply chains. Availability isn’t a concern to us at the moment. I think the challenge has to do with price increases,” he said.

He explained that while global price pressures could transmit into the domestic economy, Ghana is better positioned than in previous years to absorb external shocks due to stronger fiscal and external buffers.

“The good news is that in Ghana, we do not have subsidies on petroleum products. But the good news is that we have built some significant reserves,” he stated.

Dr Forson further highlighted Ghana’s improving gold production and sustained high global gold prices as key sources of foreign exchange support for the economy.

“And our gold production is also going up and gold prices are also very high. And so Ghana is in a comfortable position to be able to withstand those shocks,” he added.

He, however, conceded that inflation could experience mild upward pressure in the months ahead.

“Where I think we may see a bit of pressure will be on the back of inflation. We expect that inflation may inch up — today it is about 3.4. I still think we’ll be better off. And I don’t think the country’s inflation will exceed 5% by the end of the year.”

The Finance Minister also pointed to improving export performance, particularly in cocoa and oil, as additional support for Ghana’s external position.

“Because our major exports are doing well. Cocoa, yes, dipped, but the cocoa price has started going up. Oil, we’re also an oil exporter. And so foreign exchange, we’re also getting something back,” he noted.

Meanwhile, Ghana’s central bank says it will continue to adopt a cautious monetary policy stance. The bank recently kept its policy rate at 14 percent after a series of earlier cuts.

The stance has been attributed to inflation risks linked to geopolitical tensions and rising global crude oil prices.



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