Fitch Solutions Projects Real Household Spending to Reach GHS 134.5 Billion in 2024
Fitch Solutions has projected a significant increase in real household spending in Ghana, forecasting it to rise to GHS 134.5 billion in 2024, up from GHS 125.1 billion in 2023.
This represents a notable recovery from the GHS 103.4 billion recorded in 2019, prior to the COVID-19 pandemic.
The research agency anticipates a robust year-on-year growth rate of 7.5% in household spending for 2024, an acceleration from the 6.7% growth observed in 2023.
This outlook aligns with Fitch Solutions’ Country Risk team’s expectations of economic growth of 4.3% in 2024 and 4.5% in 2025, indicating a sustained period of strong private consumption.
Looking ahead to 2025, Fitch forecasts a slight deceleration in spending growth to 5.0% year-on-year, reaching GHS 141.2 billion.
This anticipated slowdown is attributed to several tailwinds, including a cooling inflation rate, strengthening economic conditions, labor market stability, and a more accommodative monetary policy.
However, potential downside risks stemming from the upcoming presidential election in December 2024 could introduce uncertainties into the economic landscape.
Meanwhile, Fitch Solutions notes that consumer confidence stood at 92 in March 2024, reflecting a slight decline from the December 2023 and January 2024 figures of 93.
Nevertheless, this marks a significant improvement from the October 2022 low of 73.9.
According to Fitch Solutions, inflation has played a pivotal role in dampening consumer sentiment, but the recent cooling of inflation rates is expected to rejuvenate consumer confidence, moving it closer to pre-pandemic averages of 97.6 recorded between 2015 and 2019.
