easing inflation and exchange rate stability. The Monetary Policy Rate (MPR) was reduced from 25.5 percent in January 2017 to 21.0 percent in July 2017. Similarly, money market interest rates broadly declined. The average lending rates of banks, responded to the downward revision in the BoG’s policy rates, and eased to 28.9 percent in September 2017 from 31.7 pecent in December 2016. Exchange Rate Mr. Speaker, the cedi remained relatively stable against the major currencies on account of improved liquidity in the foreign exchange market. As at October 2017, the Ghana cedi had cumulatively depreciated by 4.0 percent against the US dollar, compared to 4.3 percent in the same period last year. External Developments Mr. Speaker, the Balance of Payments (BOP) recorded a surplus of US$379.3 million for the first three quarters of 2017, compared with a deficit of US$1.3 billion in 2016. This improvement was mainly driven by higher export earnings and private transfers. The Gross International Reserves as at end September 2017 stood at US$7.2 billion, equivalent of 4.1 months of import cover. This compares favourably with an outturn of US$4.8 billion, equivalent of 2.5 months of import cover for the same period last year. Fiscal Developments Mr. Speaker, the thrust of fiscal policy for the 2017 Budget was to restore confidence in the economy, ensure fiscal and debt sustainability, and promote overall macroeconomic stability through a number of bold initiatives. Preliminary data for September 2017 indicate that fiscal outturn was broadly in line with expectations despite revenue shortfalls. Total Revenue and Grants for the period fell short of target by 9.3 percent (an actual of GH¢28.4 billion, against a target of GH¢31.3 billion), while Total Expenditure (including arrears clearance) fell short of target by 8.1 percent (an actual of GH¢37.7 billion, against a target of GH¢41 billion). This resulted in an overall fiscal deficit on cash basis of 4.6 percent of GDP against a target of 4.8 percent of GDP.
easing inflation and exchange rate stability. The Monetary Policy Rate (MPR) was reduced from 25.5 percent in January 2017 to 21.0 percent in July 2017. Similarly, money market interest rates broadly declined. The average lending rates of banks, responded to the downward revision in the BoG’s policy rates, and eased to 28.9 percent in September 2017 from 31.7 pecent in December 2016. Exchange Rate Mr. Speaker, the cedi remained relatively stable against the major currencies on account of improved liquidity in the foreign exchange market. As at October 2017, the Ghana cedi had cumulatively depreciated by 4.0 percent against the US dollar, compared to 4.3 percent in the same period last year. External Developments Mr. Speaker, the Balance of Payments (BOP) recorded a surplus of US$379.3 million for the first three quarters of 2017, compared with a deficit of US$1.3 billion in 2016. This improvement was mainly driven by higher export earnings and private transfers. The Gross International Reserves as at end September 2017 stood at US$7.2 billion, equivalent of 4.1 months of import cover. This compares favourably with an outturn of US$4.8 billion, equivalent of 2.5 months of import cover for the same period last year. Fiscal Developments Mr. Speaker, the thrust of fiscal policy for the 2017 Budget was to restore confidence in the economy, ensure fiscal and debt sustainability, and promote overall macroeconomic stability through a number of bold initiatives. Preliminary data for September 2017 indicate that fiscal outturn was broadly in line with expectations despite revenue shortfalls. Total Revenue and Grants for the period fell short of target by 9.3 percent (an actual of GH¢28.4 billion, against a target of GH¢31.3 billion), while Total Expenditure (including arrears clearance) fell short of target by 8.1 percent (an actual of GH¢37.7 billion, against a target of GH¢41 billion). This resulted in an overall fiscal deficit on cash basis of 4.6 percent of GDP against a target of 4.8 percent of GDP.
41888final%202018%20budget%20speech.docx