Real Household Spending to Grow by 2.5% to GHS 129.7 Billion This Year
Ghana’s real household spending is projected to grow by 2.5% year-on-year in 2025, a notable improvement from the weak growth of 1.1% recorded in 2024.
This is according to Fitch Solutions, which estimates total household spending to expand to GHS 129.7 billion in 2025, reflecting a 25.4% increase over the pre-pandemic level of GHS 103.4 billion recorded in 2019.
The UK-based research firm attributes this growth to cooling inflation and greater cedi stability, factors that will also allow for a more accommodative monetary policy stance from the Bank of Ghana (BoG).
Drivers of Growth: Lower Inflation and Cedi Stability
Fitch Solutions anticipates an improvement in Ghanaian household spending as inflationary pressures ease and the cedi stabilizes. It noted that consumer activity is already beginning to rebound following the December 2024 presidential elections.
“We will see an improvement in Ghanaian household spending over 2025 as households recover from elevated inflation and cedi weakness. With cooler levels of price growth, greater cedi stability, and a dovish approach from the Bank of Ghana, households will experience a marked uptick in purchasing power, supporting a rebound in both essential and discretionary segments,” the report stated.
Post-Election Consumer Activity on the Rise
Recent high-frequency data suggest a rise in consumer activity following the December 2024 elections. In particular, mobile money transaction volumes surged to a record high of 745.0 million in December 2024, significantly above the July 2024 figure of 678.8 million. This increase underscores the growing level of consumer activity in the country.
Fitch Solutions acknowledged that while inflation remains a key driver of mobile money transaction growth, the rate of increase in transaction volumes surpasses inflation levels, indicating a broader consumer recovery trend.
“The rate of growth is considerably above the level of inflation and is therefore pointing to a consumer recovery story, which is reflecting in strong spending growth figures over H2 2024 and into 2025,” the report noted.
Looking ahead, Fitch Solutions projects that lower inflation in 2025 will further bolster spending growth and transaction volumes. Additionally, declining debt servicing costs are expected to provide additional tailwinds for consumer activity, contributing to an overall positive outlook for Ghana’s economy in 2025.
