Ghana's Economy Shows Strong Half Year Performance But Inflation Risks Remain

Ghana's economy recorded a genuinely strong performance in the first half of 2026, according to professional services firm PwC. This positive assessment, based on the Mid-Year Budget Review, indicates significant progress in fiscal control and debt restructuring efforts. However, PwC cautions that not all improvements represent a permanent shift in Ghana's underlying macroeconomic risk profile, with several risks threatening to undermine these gains.

The economic uplift stems from disciplined fiscal management, successful debt restructuring, and favorable base effects. Delayed expenditure execution, lower domestic interest rates, stronger foreign exchange reserves, and generally favorable financial conditions in the first half of the year also contributed. PwC projects that the Minister of Finance's year-end targets, including a real Gross Domestic Product (GDP) growth of around 4.8%, are achievable. The primary surplus target of 1.5% of GDP on a commitment basis also appears within reach, provided spending discipline continues.

This strong half-year performance fits into Ghana's broader economic narrative of recovery following recent economic challenges. The government has focused on fiscal consolidation and debt sustainability under an International Monetary Fund (IMF) program. The reported improvements suggest these measures are yielding positive results, providing a foundation for future stability. However, the reliance on factors like delayed spending and base effects means the sustainability of this performance requires careful monitoring.

PwC specifically warned about the inflation outlook, stating that the end-June inflation rate of 5.3%, while strong, rose 160 basis points in a single month. Inflation has consistently increased since March 2026, signaling a departure from the disinflationary trend observed since early 2024. "In our view, the inflationary shocks triggered by the Middle East conflict are partly responsible for this reversal in the disinflationary path," PwC stated. They anticipate inflation could push against or slightly breach the 10% upper limit by year-end, especially if the government accelerates infrastructure and education spending as suggested by the Minister.

The implications for the Ghanaian economy are significant. Businesses and investors should prepare for a second half characterized by mild reflation, selective expenditure acceleration, and a still-fragile external environment. There may be less room for further monetary easing than markets currently expect, potentially impacting borrowing costs and investment decisions. The government's ability to maintain spending discipline while addressing inflationary pressures will be crucial for sustaining economic momentum and achieving its year-end targets.

Other factors, such as elevated import demand and rising shipping costs, are also expected to exert upward pressure on inflation. PwC's position is that while the disinflation story is real, the economy is likely closer to a turning point than the Minister of Finance implies. This suggests a need for cautious optimism and proactive policy responses to mitigate emerging risks. The interplay between fiscal policy, monetary policy, and external shocks will define Ghana's economic trajectory in the coming months.