Fitch Cuts Ghana’s 2026 GDP Growth to 5.5%

By Praisebell Rosemond Larbi

Fitch Solutions has revised Ghana’s 2026 real GDP growth forecast downward to 5.5%, from an earlier projection of 5.9%, citing the economic impact of escalating tensions in the Middle East.

In its latest report titled “Strong Quarter 4 2025 For Ghana, But Iran Conflict Dims 2026 Growth Outlook,” the UK-based firm said the ongoing conflict and the effective disruption of the Strait of Hormuz are weighing on Ghana’s near-term economic prospects.

Inflation Pressures to Rise

Despite the downgrade, Fitch noted that Ghana’s external and fiscal positions are expected to remain relatively resilient, supported in part by strong gold export earnings.

However, the firm warned that higher global oil prices will likely translate into rising domestic inflation.

According to the report, major oil marketing companies in Ghana have already increased petrol and diesel prices by between 8% and 11% in early March 2026. This is expected to push up transportation costs, with knock-on effects on food prices and utility expenses.

As a result, Fitch revised its average inflation forecast for Ghana to 7.8% in 2026, up from the earlier estimate of 7.3%.

“Our base case remains that the conflict will be relatively short-lived and that global energy prices will correct fairly quickly. However, the immediate impact will be higher inflation, which could weigh on private consumption,” the report indicated.

Monetary Policy Outlook

The inflation outlook is also expected to influence monetary policy decisions by the Bank of Ghana.

Fitch noted that while elevated energy prices and global uncertainties could limit further monetary easing, the cumulative policy rate cuts of 1,250 basis points since mid-2025 are expected to support credit growth.

Even if the policy rate remains unchanged at 15.50%, the lagged effects of earlier rate reductions are likely to improve borrowing conditions and stimulate investment activity.

Investment and Growth Drivers

The firm maintained that relatively lower borrowing costs compared to previous years would underpin stronger gross fixed capital formation in 2026, supporting economic activity.

Additionally, increased output in Ghana’s oil and gold sectors is expected to provide a boost to exports, helping to offset some of the negative effects of global uncertainties.

These factors are expected to provide some resilience to the economy, even as external risks persist.

Recent Growth Performance

Ghana’s economic performance remains relatively strong, with the country recording a GDP growth rate of 6.0% in 2025, largely driven by the services sector.

However, Fitch cautioned that sustaining this momentum in 2026 will depend on how quickly global tensions ease and energy prices stabilise.

Outlook

While the downward revision signals emerging risks, Ghana’s growth outlook remains relatively solid compared to many peers.

Fitch maintains that the expected slowdown will be moderate, with the economy still supported by strong commodity exports and improved macroeconomic conditions.

Nonetheless, the evolving situation in the Middle East remains a key risk factor, with potential implications for inflation, consumer spending, and overall economic stability in the months ahead.