Government is on track to cut its fiscal deficit below the projected 7.5 of gross domestic product, President John Mahama has revealed.

The President said a bailout deal with the International Monetary Fund (IMF) is helping to control public sector spending and improve macroeconomic indicators.

“We are on track – after the first review of the IMF – to hit 7.2 percent even though our target is 7.5 percent; just using first quarter numbers, we are on track to hit 7.2 percent deficit”, the President told Accra-based Uniiq FM, Wednesday.

According to him, borrowing has also been reduced significantly since the one billion dollar loan agreement with the IMF, all in a bid to prop up a declining currency and rising inflation.

After an impressive run a few weeks ago, the cedi has started falling against major trading currencies. On Wednesday it fell by 1.1 percent. The dollar goes for 4.055 cedis.

Inflation is also at a five-year high and currently stands at 17.9 percent, but the President is hopeful the situation will improve by the year.

“We are seeing some stabilization in the cedi even though it is still finding its correct level”, he explains.

On inflation, he admits that although it is on the rise, he notes, “it is rising at a smaller margin and we expect it by the end of the year to drop”.

As the country approaches the 2016 election, many analysts have predicted that the cyclical problem of budget overruns during that period could derail the country’s efforts to keep within IMF prescriptions of reduced spending, however, the President maintains he is committed to ensuring that does not happen.

“We’ve reduced borrowing from the central bank from 10 percent to 5 percent. We are not over-borrowing from the central bank [the Bank of Ghana]. Fiscal tightening is taking place and…fiscal consolidation is on the way”, John Mahama underscored.

As part of this consolidation, government put in motion the petroleum sector deregulation in a bid to ending fuel subsidies.

Despite a seeming insurmountable power crisis that has hit hard at the bottomline of businesses and the pockets of Ghanaians, the President is hopeful of better times for the country’s challenged economy.

“We are coming out of the woods, we are not there yet I must say…we are coming out because we are being more disciplined with government expenditure, we are working to increase revenues, and I think that and I think that is getting us out”, he said.