Ghana’s inflation is projected to more than double in 2027, averaging 11.3% from an annual average of 4.7% in 2026, according to a new forecast by Fitch Solutions. The UK-based research firm, the research arm of global credit ratings agency Fitch, attributes the sharp acceleration to fading exchange rate support, modest fiscal loosening and strong money supply growth.
The forecast represents a significant upward revision from Fitch Solutions’ earlier projection of 12.8% in June 2026, reflecting evolving economic conditions. The firm’s latest assessment paints a picture of a temporary disinflationary window closing as multiple pressures converge on the Ghanaian economy.
Money Supply Growth Exceeds GDP Expansion by 17.1 Percentage Points
A key concern flagged by Fitch Solutions is the rapid expansion of money supply relative to economic output. Broad money supply growth already exceeded nominal Gross Domestic Product growth by 17.1 percentage points in the second quarter of 2026. The firm warned that sustained growth in liquidity could eventually increase demand for goods, assets and foreign currency, creating additional inflationary pressure.
El Niño to Add Imported Inflationary Pressures
The strong El Niño weather event, which will peak towards the end of 2026, has already begun lifting global food prices and will likely add to imported inflationary pressures in Ghana during 2027. Fitch Solutions noted that below-average rainfall and above-average temperatures linked to El Niño will disrupt the critical November-February pod development period for cocoa, compounding structural challenges such as ageing tree stocks and smallholders’ limited capacity to mitigate weather shocks.
Ghana’s import dependence on rice and other staple foods leaves the country particularly exposed to global food price shocks. The firm noted that imported food represents a significant component of household consumption in Ghana, with the country importing approximately 47% of its rice requirements.
Bank of Ghana Expected to Tighten by 200 Basis Points
Fitch Solutions expects the Bank of Ghana to maintain its policy rate at 14% for the remainder of 2026 before raising it by a cumulative 200 basis points to 16% in 2027 as inflationary pressures build. The firm forecasts inflation will breach the 10% mark in the second quarter of 2027, prompting the central bank to begin tightening.
“As inflation accelerates and breaches the 10% mark in Q2 2027, we expect the BoG to begin tightening, raising the policy rate by a cumulative 200bps by year-end,” Fitch Solutions stated.
The firm also noted that a further escalation or more prolonged tensions in the Middle East would push energy prices higher, keeping fuel costs elevated in Ghana and adding to inflation. This could prompt the Bank of Ghana to tighten as early as November 2026 or deliver more than the 200 basis points of hikes currently forecast.
Current Account Surplus to Narrow
Fitch Solutions forecasts Ghana’s current account surplus will narrow from 7.9% of GDP in 2026 to 5.3% in 2027. The decline reflects a modest fall in gold prices from US4,200 per ounce and a 9.1% decline in cocoa production due to El Niño-related weather disruptions.
Despite the narrowing, the projected surplus would remain substantially stronger than the average deficit of 0.9% of GDP recorded over 2016-2025. Gold continues to underpin Ghana’s external stability, accounting for approximately 40% of merchandise exports, with production set to rise by 3.9% in 2027 as high prices incentivise producers to expand output.
The cocoa sector presents a more challenging picture. Ghana’s Cocoa Board has estimated 2026/27 production at around 650,000 metric tonnes, down about 13% from the previous season, citing disease pressure, ageing trees and adverse weather. Although tighter West African supply will push spot cocoa prices higher, Fitch Solutions noted the uplift is unlikely to offset lower export volumes because Ghana forward-sells most of its crop at fixed prices six to 12 months in advance.
Divergence with Government Forecasts
Fitch Solutions’ projections diverge sharply from the government’s own forecasts. Finance Minister Dr Cassiel Ato Forson has maintained that inflation would fall to 5% by December 2026 despite ongoing geopolitical tensions in the Middle East. Technical Advisor to the Finance Minister, Dr Theo Acheampong, said the Ministry of Finance still expects inflation to end 2026 within its target range of 8%, plus or minus 2 percentage points.
The Bank of Ghana’s own medium-term target band for inflation is 8±2%, with the central bank’s framework focused on guiding inflation towards the lower end of that range. Headline inflation eased sharply from 23.8% in December 2024 to 5.4% in December 2025, reflecting tight monetary conditions, before rising to 3.7% in May 2026. Consumer price growth has averaged just 4.0% year-on-year in 2026, well below the 2010-2025 average of 15.7%.
Import Cover Target Deemed “Highly Ambitious”
Fitch Solutions views the Bank of Ghana’s explicit target of achieving 15 months of import cover by 2028 as highly ambitious and unlikely to be reached. Policymakers will therefore likely seek to maintain a positive real interest rate to support portfolio investment inflows, the firm said.
Growth Outlook Remains Positive
Despite its inflation concerns, Fitch Solutions maintains a positive outlook for Ghana’s broader economy. The firm forecasts GDP growth of 5.7% in 2026, above the 2016-2025 average of 4.9%, driven by resilient domestic demand and continued growth in the mining sector. It also described the fiscal path outlined in the 2026 Mid-Year Budget Review as credible, projecting a commitment-basis fiscal deficit of 1.7% of GDP, lower than the government’s target of 2.2%.
Fitch Solutions noted that Ghana remains relatively insulated from the ongoing US-Iran conflict, supported by elevated gold prices which continue to provide a strong external buffer, as well as the country’s broadly balanced energy trade position.
However, the firm cautioned that risks remain, including a more hawkish US Federal Reserve that could weigh on gold prices and a stronger-than-expected El Niño event that could further increase food prices.
What Next
The trajectory of inflation through late 2026 and early 2027 will be closely watched by policymakers, investors and households alike. With the Bank of Ghana’s next Monetary Policy Committee meeting scheduled for November 2026, attention will focus on whether the central bank signals a shift towards tightening earlier than Fitch Solutions currently anticipates. For now, the firm’s forecast suggests Ghana’s brief period of single-digit inflation may prove to be a temporary reprieve rather than a sustained achievement.
