IMF predicts Ghana's inflation rate to reduce to 8.8% by 2028

The International Monetary Fund (IMF) has projected that, Ghana’s inflation rate by the end of the year 2028 would decline drastically to a single digit inflation of 8.8 percent.

This was made known in the recently launched Fiscal Monitor report released on Tuesday, April 11, 2023.

In the report, the Fund predicted that Ghana would end the year 2023 with an inflation rate of 45.5 percent and this would further decline by close of 2024 to 22.2 percent.

On Ghana’s fiscal deficit, the report projected that, the country’s fiscal deficit will reduce to 7.3 percent by the end of 2023, however, in 2024, the Fund expects that the rate would rise to 8.4 percent and take a dip to 7.3 percent in 2025. It will decline sharply to 5.9 percent in 2026, 5.3 percent in 2027 and end 2028 at 5.4 percent.

Although the IMF projects Ghana’s current fiscal deficit at 7.3 percent, it is lower than the Fund’s initial projection of a 8.6 percent rate. The new projection also beats the government of Ghana’s projection in the 2023 Budget statement which was pegged at 9.9 percent

Giving the fine details of Ghana’s projection at the ongoing IMF/World Bank Spring Meetings, Division Chief at the Fiscal Affairs Department of the IMF, Paulo Medas urged government to be consistent with its macroeconomic framework to enable the country attain macro stability and price stability.

“The problem is once you lose the inflation expectations then it’s going to be much more difficult because you are going to have both bites for longer so the cost is larger to bring back price stability,” he said.

EAN/MA