BoG holds Policy Rate at 27% amid improving economic stability

The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) has maintained the benchmark interest rate at 27%, citing favorable macroeconomic developments and a strengthening currency as critical factors supporting future price stability.

According to a statement issued by BoG Governor and MPC Chairman, Dr. Ernest Addison, domestic macroeconomic conditions remain stable, with significant progress under the IMF Extended Credit Facility (ECF) program. Data through October 2024 indicates steady growth, improved business and consumer confidence, and a broadly stable core inflation environment.

The BoG acknowledged that inflation projections remain slightly elevated, driven by volatile food prices, lingering exchange rate pass-through effects, and adjustments in fuel and utility tariffs. It noted that steep price increases in food items and earlier currency depreciation disrupted the inflation trajectory, stalling disinflation efforts. The central bank now forecasts inflation to return to the target band of 6–10% by Q4 2025, a slight shift from the earlier projection of Q3 2025.

Despite these challenges, the economic outlook appears positive. Growth outturns have been strong, with indicators projecting robust expansion in the second half of the year. Reserve build-up has bolstered confidence, while the cedi’s recent appreciation has further enhanced economic stability.

The ongoing implementation of the IMF-ECF program continues to yield results, with the third review concluding positively and achieving a staff-level agreement. The IMF Board is scheduled to meet in December to assess the program’s progress, with expectations of releasing an additional $360 million to Ghana. This anticipated funding is likely to provide further momentum for economic stability and recovery.