- The two main indices on the GSE continued to show signs of a rebound from the string of poor performance so far in the year.
- Government settled for a total of GHS 667.26m from 91 and 182-Day Bill issuances.
ECONOMIC SCOOP
- Bank of Ghana (BoG) maintains policy rate at 14.50%
- On account of a general slowdown in economic activity in the second quarter of the year, the BoG maintained the policy rate at 14.50% p.a.
- The decision was premised on a slowdown in GDP growth in Q1 2020 at 4.90% as against 6.70% for the same period in 2019.
- The BoG Composite Index of Economic Activity (CIEA) also witnessed contraction over the period, with business and consumer confidence remaining below the pre-pandemic level.
- The BoG also cited the slowdown in credit to the private sector as another reason its decision.
2. An estimated 22 million Ghanaians suffer reduced income due to the COVID-19 pandemic
- This was revealed through the Ghana Statistical Service’s Households and Jobs Tracker survey which sampled 3,265 households across all 16 regions in the country.
- The results showed that the Greater Accra Region was the least affected region while the Upper West, the Bono and Bono East Regions were the worst-hit regions.
3. Government suspends 5% fiscal deficit threshold for the next 4 years
- The impact of the COVID-19 pandemic has forced Government to suspend the Fiscal Responsibility Act 2018, (Act 982) which prescribed a fiscal deficit threshold of 5% of GDP.
- Consequently, Government has revised its target from 4.70% to 11.40% on expectation of raising expenditure while revenues are expected to lag their initial targets.
- Total Revenues have been revised downward from GHS 67.10 billion (16.9% of GDP) to GHS 53.70 billion (13.90% of GDP).
- Expenditure on the other hand are projected to increase from GHS 86 billion (21.60% of GDP) to GHS 97.70 billion (25.4% of GDP).
