The Bank of Ghana has cut the policy rate twice already this year. The International Monetary Fund (IMF) has advised the Central Bank to proceed with caution, citing the impacts of the protracted Middle East crisis on energy and fertiliser prices, the fiscal relaxation under the Policy Coordination Instrument, and persistent risks from high exchange rate pass-through.

An official of the Fund, during its latest Article IV Consultation and Policy Coordination Instrument (PCI) review in Accra, gave the BoG the caution following discussions and deliberations with Ghanaian authorities.

“The Bank of Ghana should exercise caution before reducing its policy rate further, given risks from energy and fertiliser prices linked to the Middle East conflict, fiscal relaxation under the PCI, and continued exchange rate pass-through. Another reduction in the policy rate could move the BoG’s monetary policy position from neutral to accommodative, a shift that is not justified under current economic conditions,” one of the Fund’s officials warned.

The IMF also warned that further rate cuts could make monetary policy too loose and put renewed pressure on inflation, risking a shift in the monetary policy stance from neutral to accommodative.

In March 2026, the BoG’s Monetary Policy Committee (MPC) decreased its policy rate by 400 basis points to 14%, bringing cumulative cuts to 1,400 basis points since July 2025.

The MPC kept the policy rate unchanged in May 2026. With inflation projected to return to the BoG’s 8±2% target by the end of 2026 and the estimated real neutral rate around 5.0%, the ex-ante real policy rate is broadly consistent with a neutral policy stance.

Meanwhile, the IMF says the BoG is reforming its monetary policy operations.

In December 2025, the BoG replaced its 56-day bills with 14-day bills to strengthen liquidity management.

Following this operational change, the BoG bill supply became limited, reducing liquidity absorption and boosting the use of the standing deposit facility. This pushed BoG bill and interbank rates towards the bottom of the interest rate corridor, effectively loosening monetary conditions by approximately 350 basis points relative to the policy rate.

In line with the IMF Staff advice, in June 2026, the BoG unified the cash reserve ratio (CRR) at 20%, eliminating the previous tiered structure (with 15% and 25% rates linked to loan-to-deposit ratio thresholds).

The International Monetary Fund (IMF) has projected a 17% increase in Ghana’s debt-to-GDP ratio, rising from 45.3% recorded in 2025 to 53.0% by the end of 2026.

The projection was included in the financial watchdog’s Fiscal Monitor Report, released on the sidelines of the 2026 Spring Meetings of the IMF and World Bank in Washington, DC.

While the report did not indicate what drivers are likely to cause the projected increase, it noted that “Government debt and interest rate projections are based on a post-debt restructuring scenario.”

A report by the Bank of Ghana (BoG) showed that Ghana’s debt-to-GDP ratio two years ago stood at 61.8% with total debt pegged at GH¢726.7 billion. By 2025, the ratio had eased to 45.3%, with total debt declining to GH¢641 billion.

Despite recent improvements, analysts say the outlook remains uncertain and could change depending on borrowing levels, exchange rate movements, and economic growth.

Some market watchers argue that increased borrowing or further depreciation of the cedi could alter the debt trajectory, while slower economic growth could also weigh on the debt-to-GDP ratio.

In April 2026, the government secured approximately GH¢2.7 billion through the issuance of a 7-year bond, marking a return to long-term domestic borrowing following the Debt Exchange Programme. The bond was issued at a coupon rate of 12.5% and is scheduled to mature on March 29, 2033.

The International Monetary Fund (IMF) has projected that Ghana’s debt-to-GDP ratio will decline further to 50.7% in 2027.

Data from the Ghana Statistical Service indicates that the size of the economy is now estimated at GH¢1.4 trillion, up from GH¢1.1 trillion in 2024.

In the 2026 Budget Statement, Finance Minister Dr Cassiel Ato Forson outlined several measures aimed at sustaining debt stability. These include expanding access to concessional borrowing, rebuilding the Sinking Fund, implementing debt reprofiling and buyback programmes, and strengthening transparency in public debt reporting.

He said the strategy is aimed at “managing debt, not being managed by it,” adding that Ghana’s goal is to return to a moderate risk of debt distress by 2028.

Ghana remains classified as a debt-distressed country by the IMF, although recent improvements have been acknowledged. The Fund expects Ghana to reach a moderate risk status by 2028 if current reforms are sustained.

Globally, the IMF warns that public debt pressures are rising, with worldwide debt projected to reach 100% of GDP by 2029, driven by higher spending needs and rising interest costs.

The Fund has called for “credible, well-sequenced fiscal adjustment” across countries to address growing vulnerabilities in the global financial system.