- Confidence Indicators Dip as Ghana’s Recovery Faces Fresh Price Pressures
Consumer and business confidence in Ghana weakened by the end of the first half of 2026, suggesting that households and companies became more cautious despite continued expansion in economic activity.
The Bank of Ghana’s July 2026 Summary of Economic and Financial Data showed that the Consumer Confidence Index declined to 112.70 in June from its previous reported level of 113.40.
Business confidence also moderated, with the Business Confidence Index falling to 107.70 from 108.10 in the preceding reported period.
Although both indicators remained above the neutral 100-point level, their downward movement suggests that optimism about economic conditions softened as consumers and businesses assessed renewed inflation, currency depreciation and the broader cost environment.
The confidence surveys offer an important measure of how households and private-sector operators perceive current economic conditions and their expectations for the months ahead. Consumer sentiment is generally influenced by employment prospects, household finances, inflation and the cost of essential goods and services, while business confidence reflects expectations about sales, investment, operating costs and the overall economic environment.
The latest decline contrasts with strong signals from the Bank of Ghana’s Composite Index of Economic Activity, which indicated that economic activity continued to expand during the first half of the year.
Real growth in the Composite Index of Economic Activity reached 13.40% in May 2026, compared with 10.20% in April and 12.60% in March. Nominal economic activity also expanded by 19.00% year-on-year in May.
The divergence between economic activity and confidence suggests that improvements in production, trade, credit and other measurable indicators may not yet have translated fully into stronger sentiment among households and businesses.
Ghana’s economy grew by 6.40% year-on-year during the first quarter of 2026. The services sector expanded by 7.10%, industry grew by 6.90%, while agriculture recorded growth of 4.00%.
Non-oil economic growth stood at 6.30%, slightly below the overall growth rate, according to the data.
However, the confidence survey figures were recorded against an environment of renewed price and exchange-rate pressure.
Headline inflation increased from 3.70% in May to 5.30% in June 2026, reversing part of the sharp decline recorded over the previous year. Non-food inflation rose more strongly to 6.30%, while food inflation increased to 3.90%.
The increase in inflation may have influenced consumer expectations by raising concerns about household purchasing power and the possibility of further increases in the prices of transport, utilities, imported products and other essential items.
The cedi also depreciated by 9.50% against the US dollar between the beginning of the year and July 17, 2026, trading at approximately GH¢11.55 to US$1.
It recorded a similar 9.50% depreciation against the British pound and weakened by 7.10% against the euro.
Currency depreciation can affect both consumer and business confidence because it raises the domestic cost of imports and foreign-currency obligations. Companies that depend on imported machinery, raw materials, fuel and finished products may face higher operating and replacement costs, while households may experience the effect through retail prices.
The moderation in business confidence occurred despite falling borrowing costs and stronger private-sector credit growth.
The average lending rate declined to 15.64% in June 2026 from 27.00% a year earlier, while the Ghana Reference Rate fell to 10.02% from 23.80% over the same period.
Nominal private-sector credit expanded by 41.20% year-on-year, while real credit growth reached 34.10%. The expansion suggests that businesses and households gained greater access to bank financing as interest rates declined and liquidity conditions improved.
However, lower borrowing costs do not automatically translate into greater business optimism. Companies may remain cautious where demand conditions, exchange-rate movements, input costs, taxation and policy uncertainty continue to affect investment decisions.
The decline in consumer confidence may similarly indicate that headline economic improvements have not been felt evenly across households. Even where inflation remains significantly lower than the levels recorded in 2025, consumers may focus more heavily on actual price levels, incomes and employment conditions than on the rate at which prices are increasing.
The June Consumer Confidence Index of 112.70 remained below the 119.20 level recorded during 2025, pointing to a broader reduction in household optimism over the period covered by the report.
Business confidence, however, appeared more stable. The index remained above levels recorded during parts of 2025 and continued to indicate generally positive sentiment, although the latest decline suggests that businesses were becoming more measured in their expectations.
The confidence indicators do not necessarily signal an economic downturn. Both remained above 100, while real-sector activity, credit growth and gross domestic product figures continued to point to expansion.
Instead, the surveys suggest that Ghana’s economic recovery is entering a phase in which the quality and sustainability of growth will become increasingly important.
Household confidence is likely to depend on whether economic growth produces stronger employment, real income gains and stable consumer prices. Business optimism will be shaped by the durability of lower interest rates, exchange-rate stability, domestic demand and the ability of companies to manage costs.
The Bank of Ghana’s confidence surveys therefore present a mixed assessment of the economy at the end of the first half of 2026.
Economic activity remained strong, lending conditions improved and private-sector credit expanded rapidly. Yet consumers and businesses became marginally less confident, reflecting concerns that renewed inflation and currency pressure could complicate the recovery.
The challenge for policymakers will be to preserve economic growth while preventing the rise in prices and depreciation of the cedi from weakening confidence further. Sustained stability in inflation, exchange rates and public finances will be necessary to convert the strong real-sector indicators into broader and more durable optimism among businesses and households.
