Financial advisory firm Deloitte has expressed confidence in Ghana’s ability to achieve its 11.9% inflation target, provided the government maintains consistent and disciplined policy execution. According to Deloitte, factors such as monetary tightening, fiscal discipline, and improved supply chain management will be crucial in stabilizing prices and curbing inflationary pressures. The firm emphasized that sustained efforts in exchange rate stabilization and prudent government spending will determine whether Ghana meets this ambitious target in the coming months.
Ghana‘s quest to bring inflation down to 11.9% by the end of 2025 is within reach if the government remains committed to its policy roadmap, according to Deloitte Ghana’s 2025 Budget Analysis Report.
The report underscores food inflation as the dominant driver of rising consumer prices and highlights the Agriculture for Transformation Agenda as a crucial intervention to enhance efficiency in food value chains, stabilize supply, and curb price volatility.
“The projected decline in inflation by end of 2025 can be achieved if the Government can follow through with the various measures designed and intended to be deployed for addressing the issue of high inflation. In particular, the Agriculture for Transformation Agenda promises to address key inefficiencies along various food value chains, thereby spurring production and taming food inflation, which has been the main driver of the high inflationary pressures we have faced” Deloitte stated in its report.
Deloitte warns that Ghana’s economic stability could be threatened by geopolitical tensions in Europe, America, and Russia, which may trigger trade disruptions and commodity price shocks. The firm urges proactive risk management to insulate the economy from these external pressures.
To further stabilize macroeconomic fundamentals, the government has initiated foreign exchange (FX) risk mitigation strategies, including:
Gold-for-Oil policy to streamline gold transactions through GoldBod
Enhanced forward FX auctions to smooth currency fluctuations
Fiscal consolidation efforts via reduced public spending and deficit control
Import substitution policies to ease reliance on foreign goods
Despite these measures, Deloitte flags declining cocoa production as a major risk to Ghana’s FX reserves. Given cocoa’s pivotal role in foreign exchange earnings, the government is urged to prioritize interventions that will revive output and sustain inflows.
“We have identified the declining cocoa production as a major issue that must be addressed to also help in boosting our forex reserves and reducing the FX demand pressure. Overall, we expect the slowdown in depreciation in recent times to continue for the rest of the year primarily due to the expected inflows of forex from the IMF programme and the World Bank Development Policy Operation (DPO) funding” the report highlighted.
Deloitte remains cautiously optimistic about the cedi’s trajectory, forecasting a continued deceleration in depreciation. This expectation is anchored on anticipated foreign exchange inflows from the IMF programme and the World Bank Development Policy Operation (DPO), which are expected to bolster reserves and strengthen currency stability.
With strategic policy execution and sustained fiscal discipline, Deloitte believes Ghana’s 11.9% inflation target is realistic, positioning the country for a more stable economic environment in the coming year.
Last Updated on March 20, 2025 by samboad
