Standards and Poor’s ratings: Ghana raised to B from B-

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Rating organization, Standard and Poor’s (S&P) Global has raised Ghana’s long-term foreign and local currency sovereign credit ratings to ‘B’ from ‘B-‘.

According to their latest on Friday, the country’s outlook is stable.

“The upgrade reflects our assessment that Ghana’s monetary policy effectiveness has improved, albeit from a low base, and will support the credibility of the inflation-targeting framework over the period,” it added.

Explaining further, S&P Global said the country’s improving banking sector stability and lower inflation support their view that the effectiveness and transmission mechanism of Ghana’s monetary policy have improved.

“The stable outlook balances Ghana’s fairly robust growth prospects, decreasing inflation, and narrower current account deficits against risks from still-high budget deficits and a high stock of public sector debt,” it stated.

S&P Global said it could lower its ratings if the country’s economic growth is significantly lower than it expected and if Ghana’s policymaking effectiveness were to weaken.

“For example, if fiscal deficits were to be materially larger than our expectations. We could consider raising our ratings if Ghana implements and adheres to measures that materially alleviate pressures on public finances and reduce public debt levels beyond our expectations.

According to the rating agency, it could also see prospects for an upgrade if the current account deficit narrows faster than it expect and external debt and gross external financing needs are significantly reduced.

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