The Bank of Ghana (BoG) has revised the economic growth target for the year, bringing it down from 7 percent to 6.6 percent.

The latest economic review by the bank noted the significant effects of the world crude oil price increases in the first seven months of the year and' thereafter, and the falling prices of cocoa and gold and other major exports since the commodity prices began to collapse.

"Assuming cocoa and gold prices were to soften by some 25 percent and oil prices were to move back to around US$89 per barrel, this would entail an income loss of 2.4 percent of Gross Domestic Product, Dr. Paul Acquah, Governor of the BoG, said in the review.

The review also points to continuing deceleration of economic activity into the entirety of next year, when GDP growth is expected to wind down modestly to 6.3 percent.

Accordingly, end of year inflation in 2009 has been forecast at 10 percent, compared to the 17 percent expected for this year - which explains the generally expected cooling of the economy compared to preceding years.

The trend falls in line with forecasts for the global economy amid the threat of recession. The International Monetary Fund (IMF) has forecast that world growth will slow to 3.7 percent next year, 1.7 percent lower than the growth expected for this year.

Growth forecasts for the US and the eurozone have been forecast to slow down to 0.5 percent and 1.4 percent respectively this year. The US is to recover slightly to 0.6 percent next year, but the eurozone will likely slide further to 1.2 percent next year.

The IMF says the big emerging countries like China and India, which are growing rapidly, will be the most affected by the slowdown, although they will be affected by slowdowns in trade among the rich nations.

Initial forecasts for the African region to grow by 6.3 percent this year and 6.4 percent next year are now hazy, especially given the threat to the performance of the net oil importing countries.

Ghana is a net crude oil importer and the crude oil price highs experienced during the year have affected levels of domestic demand.

A new government is expected to be sworn in next year and this is expected to reduce government spending levels next year, since time would be taken to plan for programmes to rollout.