Ghana’s financial markets delivered a remarkably strong performance in the first quarter of 2026, with the Ghana Stock Exchange (GSE) recording one of its best starts in recent years as improving macroeconomic stability, easing inflation and renewed investor confidence fueled sharp gains across equities and fixed income markets.
The GSE Composite Index sustained a strong upward trajectory during the quarter, posting a year-to-date return of 48.91%, significantly higher than the 27.19% recorded during the same period in 2025.
The impressive rally reflected broad-based market participation, with gains recorded across nearly all sectors of the market and only one sector declining during the quarter. Tesah Capital analysts say the widespread gains point to strengthening investor confidence and improved market breadth as macroeconomic conditions continue to stabilise.
Trading activity surges
Trading activity on the exchange also strengthened sharply in the first quarter, underscoring renewed participation by both institutional and retail investors.
Trade volumes surged by 817.13% year-on-year, while the value of trades increased by 441.40% over the same comparative period.
Market analysts attributed the strong growth in trading activity not only to rising investor participation but also to larger average transaction sizes as confidence gradually returned to the capital market.
MTN Ghana dominates market
Telecommunications giant MTN Ghana remained the dominant stock on the exchange during the quarter, reinforcing its central role in market liquidity and investor activity.
According to the market data, MTN Ghana accounted for approximately 462.4 million shares traded with a total value of about GH¢2.3 billion.
The company continued to attract both growth-focused and income-oriented investors due to its strong fundamentals, steady capital appreciation and attractive dividend yields.
Analysts noted that financial stocks are also increasingly positioning themselves as medium- to long-term value opportunities as balance sheets improve following restructuring exercises and earnings gradually normalise.
Economic growth remains resilient
The strong performance of the equity market occurred against a backdrop of improving macroeconomic indicators.
Ghana’s economy recorded strong growth momentum in 2025, expanding by 6% for the full year, while fourth-quarter growth stood at 5.8% year-on-year.
However, growth is expected to moderate slightly in 2026 as the economy gradually normalises.
Projections by the International Monetary Fund and the Ministry of Finance indicate that Ghana’s economy is expected to grow by 4.8% in 2026.
Economic growth in the second quarter is expected to remain largely supported by the services sector, particularly information and communication technology, financial services and trade.
Agricultural activity is also expected to provide support due to seasonal crop production, although persistent weaknesses in oil and gas production are likely to weigh on industrial sector output.
Inflation declines sharply
Inflation conditions improved sharply during the first quarter, helping support investor confidence across the financial markets.
Headline inflation declined significantly to 3.2% during the quarter as exchange rate stability, easing imported inflation and anchored inflation expectations contributed to the disinflation trend.
Tesah Capital analysts, however, cautioned that slight increases in inflation for domestically produced goods may signal emerging demand-side pressures that could create moderate upside risks later in the year.
Despite these concerns, inflation is expected to remain within the Bank of Ghana’s target range of 8±2 percent in the near term.
Monetary policy outlook
With inflation moderating and macroeconomic conditions improving, the Bank of Ghana is expected to maintain an accommodative monetary policy stance in the second quarter.
The policy rate currently stands at 14% and is likely to remain unchanged in the near term as the central bank evaluates the sustainability of the disinflation trend and external sector stability.
Tesah analysts nevertheless believe there remains room for further gradual monetary easing if inflation continues to trend downward and exchange rate pressures remain subdued.
Cedi stability expected
The Ghana cedi is also expected to remain relatively stable in the second quarter, supported by stronger foreign exchange inflows, particularly from gold exports, and improving external sector fundamentals.
Market analysts at Tesah Capital noted that the relatively lower depreciation recorded in the first quarter compared to 2025 reflects improving macroeconomic stability.
However, risks to exchange rate stability remain, particularly from potential global commodity price volatility and possible reversals in international capital flows.
Treasury bill demand remains strong
The fixed income market also experienced significant recovery during the first quarter.
Investor demand for Treasury bills remained exceptionally strong, with total bids oversubscribed by 21.4% against a government target of GH¢85.8 billion.
Tesah Capital analysts attributed the strong appetite for government securities to renewed confidence in Ghana’s macroeconomic outlook as well as government efforts to reduce short-term borrowing pressures.
Secondary market recovery
Secondary market activity also improved considerably during the quarter.
Trade volumes and trade values on the secondary bond market increased by 93.08% and 114.93% respectively, indicating recovering market liquidity and stronger investor participation.
Analysts expect improved liquidity conditions to support a gradual decline in yields over the coming months as secondary market activity continues to deepen.
Nevertheless, investors have been advised to remain cautious about locking in long-term rates because government efforts to suppress short-term borrowing costs may not remain sustainable throughout the year.
Outlook for Q2 2026
Looking ahead to the second quarter of 2026, analysts expect the strong bullish momentum on the Ghana Stock Exchange to continue, although the pace of gains may moderate as valuations adjust and investors become increasingly selective.
Banking stocks are expected to benefit from post-restructuring improvements in balance sheets and profitability, while telecom stocks led by MTN Ghana are likely to remain among the strongest market drivers.
Secondary market activity is also expected to continue recovering as liquidity conditions improve and investor confidence strengthens further.
Mutual funds and unit trusts are similarly projected to record improved performance due to mark-to-market valuation gains on previously illiquid bonds.
Risks remain
Despite the improving outlook, analysts cautioned that several downside risks remain capable of affecting market stability during the year.
These include potential exchange rate reversals, fiscal slippages, debt sustainability concerns, global commodity price volatility, external financing constraints and possible delays in economic reform implementation.
Geopolitical tensions involving Iran and the resulting risk of global oil price shocks were also identified as major threats that could weaken investor demand and widen interest rate spreads within Ghana’s economy.
Nonetheless, Tesah Capital analysts believe the first quarter performance demonstrates that Ghana’s financial markets are gradually regaining stability and investor confidence after years of economic turbulence, positioning the country for potentially stronger market activity through the remainder of 2026
