In a statement released on October 9, 2026, Moody's Ratings upgraded Ghana's long-term foreign currency and local currency issuer ratings to B3 from Caa1, changing the outlook to stable from positive. The upgrade reflects improved debt affordability and macroeconomic stability, driven by sustained easing in domestic financing conditions. This improvement is attributed to fiscal discipline and favourable export prices. Ghana's economy has benefited from historically elevated gold prices, with gold accounting for 67% of total goods exports in 2025.
The upgrade to B3 incorporates credit constraints, including high susceptibility to terms-of-trade volatility and exchange rate depreciation. Additionally, relatively low government revenue generation constrains the flexibility of fiscal policy, and policy effectiveness is weak but improving. However, these are balanced by credit strengths, such as a moderate debt burden and a track record of financing support from multilateral creditors. Ghana has also demonstrated a track record of political stability and the relative strength of legislative and executive institutions.
A key factor in the upgrade is the improvement in Ghana's debt affordability, driven by a sustained easing in domestic financing conditions. Interest payments were 24% below the budget target in the first half of 2026, amounting to 17.2% of government revenue for that period. This is the lowest ratio since 2012 and represents a material credit improvement. Moody's projects interest payments to average around 20 to 25% of revenue through to 2028, down from 25 to 30% at the time of the upgrade to Caa1 in October 2025.
The improvement in funding costs is also attributed to lower domestic financing costs, reflecting an easing of inflationary pressures aided by exchange rate appreciation. Inflation remained contained below the Bank of Ghana's target range, although the Middle East conflict contributed to a pause in the Bank's easing cycle. Inflation reached a trough of 3.2% in March 2026 before rising to 5.2% in September. Continued fiscal discipline, including restrained government spending, supported a primary surplus outturn of more than 2% of GDP in 2025.
The government debt burden has fallen to 48.8% of GDP in 2025 from 70.1% in 2024, reflecting currency appreciation and fiscal consolidation. Moody's expects fiscal discipline to continue under a non-funded 36-month International Monetary Fund Policy Coordination Instrument. This agreement aims to anchor reform momentum and investor confidence following the completion of the Extended Credit Facility programme in July.
The stable outlook captures balanced risks at the B3 level, with Moody's expecting Ghana's macroeconomic stability and reduced government liquidity risk to be sustained. The agency projects government debt to remain stable at around 50% of GDP over the next several years and expects government interest payments to stabilise at around 20 to 25% of government revenue. On the upside, a lengthening track record of fiscal discipline and sustained progress in improving external buffers could improve resilience to terms-of-trade volatility.
However, downside risks stem mainly from high susceptibility to exchange rate and commodity price volatility and sizeable fiscal risks. A large drop in gold prices would weigh on terms of trade, reduce foreign exchange inflows, and likely lead to exchange rate pressures and higher inflation. Fiscal risks stem from the weak financial performance of state-owned enterprises, the legal requirement to recapitalise the Bank of Ghana's negative net equity position by 2032, and a track record of fiscal slippages during electoral cycles.
Key points
- Ghana's credit rating upgraded to B3 from Caa1 by Moody's Ratings.
- Improved debt affordability and macroeconomic stability drive the upgrade.
- Stable outlook reflects balanced risks at the B3 level, with sustained macroeconomic stability and reduced government liquidity risk expected.
