After months of uncertainty, Ghanaians are beginning to feel a little more hopeful about the economy. Businesses that once hesitated to invest are now looking ahead with optimism, and consumers who were tightening their belts are slowly loosening them.
The numbers back this up. Consumer confidence, which hit a low of 81.2 in June 2024, has bounced back to 100.2 in February 2025. Similarly, business confidence has risen from 90.9 in December 2023 to 99.7 in February 2025.
So, what’s changing? A few key trends suggest the economy is gradually finding its footing.
First, inflation, while still high, seems to be easing. After peaking and dipping unpredictably throughout the past year, inflation settled at 23.1% in February 2025, almost unchanged from 23.2% in February 2024. The real headache, food inflation, swung wildly from 29.6% in March 2024 to 19.1% in August, before climbing back to 28.1% in February 2025. Meanwhile, non-food inflation also slowed down, dropping from its 23.6% peak in May 2024 to 18.8% by February 2025.
Despite the fluctuations, the overall trend suggests that price pressures, while still biting, may be softening.
Another big shift is happening with Treasury bill rates, which have fallen sharply. In March 2024, the 91-day T-bill rate was 26.40%, but by March 2025, it had dropped to 15.74%. The 182-day bill fell from 28.90% to 16.93%, and the 364-day bill from 29.50% to 18.85%. This means the government is borrowing at lower costs, and if this trend continues, businesses and individuals could see lower interest rates across various financial products.
Meanwhile, the Monetary Policy Committee (MPC) rate, which serves as a key benchmark for financial rates, has increased to 28%. Typically, this would influence rates across the financial system, but with Treasury bill rates falling and the Ghana Reference Rate for March 2025 at 27.90%, lending rates might still see some downward pressure. This is because banks factor in not just the MPC rate but also T-bill rates and the interbank rate when pricing loans.
While these signs are promising, the big question remains: Will this momentum hold? Much will depend on how inflation behaves, whether interest rates continue to fall, and how businesses and consumers respond in the months ahead.
Source: thehighstreetjournal.com
