Fitch Solutions Revises Ghana’s 2025 Inflation Forecast to 17.2%, Cites Stronger Consumer Spending Outlook
Fitch Solutions has revised Ghana’s average inflation forecast for 2025 downward to 17.2%, from an earlier projection of 18.8%, citing easing price pressures and a gradual recovery in consumer confidence.
The UK-based research firm noted that the downward revision would ease pressure on household budgets and help bolster consumer spending, which is expected to drive economic growth in the second half of the year.
Its sister firm, Fitch Ratings, has offered a slightly more optimistic inflation outlook, projecting average inflation for the year at 15%.
Fitch Solutions maintained that high-frequency economic indicators continue to point towards a resilient recovery in consumption levels. The Bank of Ghana’s Consumer Confidence Index surged to 103.6 in April 2025, significantly higher than the 87.7 recorded during the same period last year. The improvement, the firm explained, reflects growing optimism among households about their financial circumstances and is expected to sustain retail and service sector growth in the months ahead.
Another key indicator of consumer activity, mobile money transactions, also showed notable momentum, rising 23.5% year-on-year in April 2024. The firm interpreted this as further confirmation of robust consumer activity across the economy.
However, despite the bright outlook for consumption, Fitch Solutions cautioned that high interest rates will continue to weigh on fixed investment in the near term. It observed that the Bank of Ghana’s policy stance, though expected to ease in September, remains restrictive.
“The BoG under new Governor Johnson Asiama surprised markets with a 100-basis point hike in March [2025], raising the policy rate to 28.00%, and held rates steady in May. While we expect the BoG to begin easing in September, the current tight monetary stance will continue to suppress borrowing and delay corporate investment plans,” the firm stated.
It further disclosed that real credit growth—though positive—remains modest. Between January and February 2025, credit to the private sector rose by 4.8% year-on-year, a weak recovery considering the 20.4% contraction over the same period in 2024.
According to Fitch Solutions, while Ghana’s consumer sector is showing signs of vitality, structural constraints, particularly in access to credit and cost of capital, may limit the pace of broader economic recovery.
