Fitch solutions Archives - Page 2 of 3

26 May

Monetary Policy To Remain Unchanged Till Fourth Quarter – Fitch Projects

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Fitch Solutions has projected that Ghana’s Central Bank is expected to begin easing the monetary policy rate by the fourth quarter of 2023. According to Fitch, this will be due to easing inflation in the coming months. This projection by Fitch essentially means that the cost of loans will continue to be high till the end of this year. “We expect that the BoG will commence a monetary easing cycle in Q423, cutting the policy rate by 200bps to 27.50% by end-2023. Consumer price growth will continue to moderate through H223 [2nd half of 2023] due to a stable exchange…

09 May

Cedi To End 2023 At ¢12.40 To A Dollar – Fitch Solutions

wontumionlineBusinessCEDI, dollar, Fitch solutions, imf

The Ghana cedi is expected to end 2023 at ¢12.40 to one US dollar, Fitch Solutions has predicted. This means the rate of depreciation will be far lower than the 38% recorded last year. The research and market information firm’s argument is based on the premise that Ghana will secure an International Monetary Fund-support programme by May 2023 that will go a long way to cushion the cedi against foreign exchange pressures. It added that while short-term exchange rate volatility will persist, it believes the cedi will stabilise once a formal creditors’ committee is formed and the IMF executive board…

21 Apr

Covid-19 And Russia/Ukraine War Are Not Only Contributors To Ghana’s Economic Woes – Fitch Solutions

wontumionlineBusinessCOVID-19, Fitch solutions, Mike Kruiniger, Russia/Ukraine war

Fitch Solutions has dismissed the view that Ghana’s economic woes is largely due to the Covid-19 pandemic and the Russian/Ukraine war. According to the research and market information firm, the country’s debt had reached alarming levels even before the external shocks set in. Responding to a question at a recent Sub Saharan Africa Macroeconomic Update, Senior Country Risk Analyst, Mike Kruiniger said both external and internal shocks caused the macroeconomic imbalances in the country. “I think the answer is, it’s been aggravated by the Covid-19 pandemic and the war in Ukraine. Those two are not the only cost to Ghana’s…

10 Apr

Inflation To Average 16% In 2024 – Fitch Solutions

wontumionlineBusinessBoG, Fitch solutions, imf, Inflation

Inflation will average 16.0% in 2024, Fitch Solutions has projected. However, it is forecasting inflation to average 37.6% in 2023, higher than the 31.5% recorded in 2022. “As such, we believe that policymakers will remain focused on controlling price growth in the near term as they aim for a more substantial disinflation trajectory before concluding the tightening cycle” it stated in its latest assessment of Ghana. It said under an expected International Monetary Fund (IMF) programme, the Bank of Ghana will likely be encouraged to keep the policy rate elevated to “strengthen its monetary policy framework”. “We forecast inflation will…

31 Mar

DDEP: Banks Loans To Businesses, Households To Fall Significantly – Fitch Solutions

wontumionlineBusinessBanks, DDEP, Fitch solutions, loans

Fitch Solutions has indicated that the banking sector loans will fall considerably in 2023, whilst deposit growth will decline marginally. It said Ghana’s client loan growth will ease from 30.2% year-on-year in 2022 to 18.0% in 2023. This is a result of the challenging macroeconomic backdrop, as banks remain uncertain about the possible fallout from the domestic debt restructuring, as well as base effects from very strong loan growth in 2022. “Whilst our nominal client loans growth forecast will still be in double digits in 2023, skewed by still elevated inflation, our real client loan growth forecast will be much…

02 Mar

Government Unlikely To Issue Eurobonds At Attractive Yields In Short-Term Despite Securing IMF Programme – Fitch Solutions

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The government is unlikely to issue Eurobonds at attractive yields in the short term even if it secures an International Monetary Fund support programme this month or in the next couple of months. In its February 2023 Africa Monitor Report, Fitch Solutions, said the rising interest rates which has been hiked to 28% at the beginning of last year make domestic borrowing more expensive. “First, Ghana faces external financing constraints. Indeed, the country has been cut off from the international capital market since late-2021 due to subdued investor confidence. While an expected IMF deal in Quarter 1, 2023 will gradually…

20 Feb

Ghana’s 2023 Budget More Expansionary – Fitch Solutions

wontumionlineBusiness2023 Budget, Budget deficit, fiscal, Fitch solutions

Fitch Solutions has disclosed that Ghana’s 2023 budget is more expansionary than it had anticipated, keeping public spending elevated. In its latest February 2023 Africa Monitor Report, it said despite the government aiming to implement some expenditure reforms, the Finance Minister, Ken Ofori-Atta, did not announce large-scale spending cuts. “While the government aims to implement some expenditure reforms – including a hiring freeze for public servants and placing a cap on salary adjustments at state-owned enterprises – the Finance Minister did not announce large-scale spending cuts”. “Indeed, the government aims to keep capital expenditure and grants to government units elevated…

13 Feb

Ghana’s Oil Production Outlook Hangs In Balance – Fitch Solutions

wontumionlineBusinessAker Energy, Fitch solutions, Lukoil, Pecan Oilfield

Ghana’s oil production outlook is hanging in the balance amid the delay of the Pecan Oilfield development. The Pecan Oilfield has come under dispute since Russian invasion of Ukraine. According to Fitch Solutions, Aker Energy has been hesitant to put forward its updated Plan for Development to the Ghanaian government and commit to Final Investment Decision (FID), whilst Lukoil is involved in the project as the risk of sanctions levied on Russian oil and gas companies that could limit Aker’s ability to work with Lukoil and interfere with operations at the field. The Pecan field, which is part of the…

09 Feb

DDEP To Weigh On Balance Sheet Of Banks – Fitch Solutions

wontumionlineBusinessBanks, Domestic Debt Exchange Programme, Fitch solutions, Mike Kruninger

The Domestic Debt Exchange Programme is likely to weigh on the balance sheets of banks in Ghana and consequently reduce credit to the private sector, Fitch Solutions has revealed in January 2023 Sub-Saharan Africa Market Update. According to research and market information firm, the reduction in loans particularly to corporate institutions will impact on the real sector of the economy. Senior Country Risk Analyst in charge of Sub-Saharan Africa, Mike Kruninger, said this should be a woke up call to the government. “When talking about access to credit, another factor that I think is really important to mention here is…

06 Feb

Fitch Reiterates Position Cedi Will Record Strong Performance In 2023

wontumionlineBusinessCEDI, Fitch solutions, imf, Mike Kruninger

Fitch Solutions has reiterated that the Ghana cedi will record a strong performance against the US dollar in 2023. According to the UK based firm, this will come on the back of an expected boost in the country’s reserves as a result of $3 billion from the International Monetary Fund support programme and an improvement in the current account position. The government of Ghana is optimistic of concluding its Debt Exchange Programme by the end of February 2023, Speaking at a Sub-Saharan Africa Market Update, Senior Country Analyst, Mike Kruninger, said the cedi’s performance in 2023 will be very much…