London-based ratings agency, Fitch, has reaffirmed it’s rating of Ghana as B with a negative outlook.

In a press release the agency cited fiscal and external risks as justification for its rating. It believes reducing the deficit is going to be difficult due to high borrowing costs, a weakening currency and huge stock of non-concessional debt and accompanying interest payments.

Fitch expects the fiscal deficit at year end to be 7.8% of GDP although government expects to meet its target of 7.3%. They are also expecting a deficit of 6.2% of GDP against government’s 5.3% target.

In related news, the MPC of BoG yesterday hiked interest rates to 26% from 25% against many policy expectations. The Business & Financial Times is reporting that the move was to check and inflation and the weakening currency.