The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) has reduced the rate at which it lends to commercial banks, known as the policy rate, by 350 basis points to 21.5 per cent.
The move is expected to encourage financial institutions to lend more at cheaper rates to businesses and households, thereby enhancing operations and creating jobs for many Ghanaians.
Speaking at a press conference in Accra on September 17, following the 126th MPC meeting, the Governor of the BoG, Dr Johnson Pandit Asiama, explained that the decision to cut the rate was supported by a majority of committee members.
He noted that the committee projected inflation to decline by the end of the fourth quarter. “The committee believes that inflation will continue to ease in the short term and, in the outlook, headline inflation is expected to settle within the medium-term target band of eight per cent, plus or minus two, by the end of the fourth quarter,” Dr Asiama said.
The Governor, however, cautioned that any upward adjustment in utility tariffs could create price pressures in the medium term, potentially affecting the inflation outlook.
