Governor of the Bank of Ghana (BoG), Dr Johnson Pandit Asiama, says inflation is expected to decline to between 4 and 6 percent before the end of the year, supported by stronger growth fundamentals and a more stable macroeconomic outlook.

Speaking at the opening of the 127th Monetary Policy Committee (MPC) meeting on Monday, November 24, Dr Asiama highlighted what he described as a notable pickup in economic activity during the current quarter. He noted that growth has been “stronger and more diversified than anticipated,” with the first half of the year recording Gross Domestic Product (GDP) growth of 6.3 percent, driven largely by robust performances in services and agriculture. Non-oil GDP expanded by 7.8 percent over the same period.

High-frequency economic indicators reinforce this momentum, with the Composite Index of Economic Activity rising by about 9 percent, while both business and consumer confidence remain upbeat. According to the Governor, these trends signal that the negative output gap is narrowing and the economy is transitioning from recovery into expansion.

He attributed the gains to sustained fiscal discipline, a cautious but supportive monetary policy stance, and structural reforms—particularly improvements in foreign exchange operations and efforts to rebuild external reserves. He added that the 2026 Budget further anchors this policy direction, prioritising growth and job creation.

Dr Asiama said the growth outlook remains positive, with staff projections pointing to continued expansion through 2026. Strong harvests, improved food supply, better FX liquidity, and easing credit conditions are expected to support performance across non-oil sectors including services, industry, and agriculture.

He noted that monetary conditions are also conducive to stability, with moderated money supply growth helping to anchor inflation and real interest rates providing space for a gradual policy easing cycle. Inflation, he said, is expected to settle within the 4–6 percent range by year-end and stabilise around the target band throughout 2026, marking the beginning of what could be a prolonged period of price stability.

However, the Governor cautioned that risks remain, including global geopolitical tensions, commodity market volatility, and tighter external financing conditions. Domestically, he acknowledged that taxes, utility adjustments, and borrowing costs continue to exert pressure on businesses despite improving sentiment.