Moody’s Says Ghana Deficit Will Heighten Currency Volatility
- Country seeks to finalize audit of budget arrears by Feb. 15
- Discovery of unpaid spending is credit negative, Moody’s Says
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Ghana’s worse-than-expected budget deficit will heighten currency volatility and elevate the nation’s funding demands to finance previously undisclosed arrears of 7 billion cedis ($1.6 billion), according to Moody’s Investors Service.
The discovery of the payment arrears reverses Ghana’s progress on consolidating its fiscal deficit since 2015 under an International Monetary Fund program, Moody’s said in an e-mailed statement on Monday. The shortfall is also weighing on debt dynamics and will undermine the cedi, “all credit negative for the sovereign,” it said.