Addressing a press conference in Accra on Monday, Dr Ernest Addison said the recent exchange rate pass-through had slowed the disinflation process, leading to a slightly elevated inflation profile.

Annualized inflation rose for a third time in a row to 9.5 per cent in April, while the Ghana cedi currency, which had seen a bout of volatility in the first quarter, depreciated 5.8 per cent in the year to May 23, compared with a 0.2 per cent for the corresponding period of 2018.

Dr Addison said economic growth remained steady and was projected to gain some additional momentum over the horizon, supported by crude oil production. "Early indications already show that economic activity in the first quarter is picking up pace as evidenced by the Bank's CIEA. Other factors such as improving business sentiments and credit growth are supportive of growth in the outlook," he said.

On fiscal developments, Dr Addison said the Committee noted that implementation of the budget in the year to April 2019, showed continued challenges with revenue mobilization alongside increased pace of spending, which posed some risks to the fiscal outlook.

"Expenditure pressures have been exacerbated by payments associated with the energy sector. These are exerting financing pressures on government and more stepped-up efforts would be required to ensure total realignment of expenditures to revenues," he said.

Total public debt rose to 57.5 percent of GDP (GH¢198.0 billion) at the end of March 2019 compared with 49.5 percent of GDP (GH¢147.9 billion) at the end of March 2018. Of the total debt stock, GH¢11.0 billion (or 3.2 per cent of GDP) represented bonds issued to support the financial sector clean-up.

Dr Addison said private sector credit growth continued to gain traction as banking sector liquidity improved supported by the recapitalization exercise.

Annual growth in private sector credit was up by 19.8 percent in April 2019, compared with 5.6 percent growth in the same period of 2018.  On a year-to-date basis, private sector credit recorded a 5.1 percent growth in April 2019, compared with a contraction of 4.0 percent last year.

In real terms, private sector credit expanded by 9.4 percent. On the execution of the budget, provisional data for the first quarter of 2019, showed an overall deficit (on cash basis) of 1.8 percent of GDP against the target of 1.4 percent of GDP and a primary deficit of 0.8 percent of GDP compared to a targeted deficit of 0.3 percent of GDP.

The higher-than-projected fiscal deficit outturn was due to the lower-than-projected domestic revenue collections which were not accompanied by expenditure rationalization. The revenue shortfalls were mainly from personal income taxes, import duties and levies, and non-tax revenues.

Over the quarter, total revenue and grants amounted to GH¢10.1 billion compared with the programmed target of GH¢12.4 billion. Total expenditure was GH¢16.5 billion, slightly below the target of GH¢17.3 billion, and representing a 37.7 percent annual growth.

The Gross International Reserves (GIR) as at end of April 2019 was US$9.3 billion (4.7 months import cover), largely on account of energy-related debt payments and higher obligations associated with externally held domestic debt payments.