How to resolve wall condensation issue?

It’s very cold winter time here in New England right now and while renovating the kitchen we found damp, frosty, and moldy plywood sheathing behind the insulation in our wall. It spreads out quite a bit so we are assuming it’s a condensation issue. The house was built in 1962 and originally had no insulation in the walls or under the siding. Upgrades that the previous homeowners made included blown in fiberglass insulation, and foam board underneath new vinyl siding. I’m assuming it was around that time that this issue may have began. We certainly want our walls to be insulated in this cold climate, but we want to redo it (after replacing sheathing in this area) so as to avoid any further moisture issues. For context, it doesn’t tend to get too humid here in the summer, and we don’t use air conditioning so the interior is pretty much the same as exterior in summer. We have regular baseboard heat in the winter. My thought was to use something with a vapor barrier on the interior side, such as Kraft paper faced fiberglass, but I’m not sure. Any suggestions on how to rebuild this wall to avoid this happening again?

Adding that we were hoping to reinsulate from the outside while sheathing is off due to difficulty of removing all drywall inside (goes under wall cabinets, around window etc.)