Cost of borrowing may marginally go down at least for the mean time as the Monetary Policy Committee (MPC) of the Bank of Ghana has maintained the policy rate at 29.5 percent.
This is the first time this year that the Central Bank is maintaining the key rate.
The monetary policy rate, which is of keen interest to businesses, signals the rate at which the Central Bank will lend to commercial banks.
Speaking at a press conference today, Monday May 22, the Chairman of the MPC and Governor of the Bank of Ghana, Dr. Ernest Addison explained that the stay of the rate is aimed at quickening the disinflation process.
“This should further help reestablish investor confidence in the domestic economy. While this development is positive for the domestic economy, it is conditional on the strong implementation of fiscal and structural policies under the programme going forward”
He continued, “These would include structural reforms on tax policy, revenue administration and public financial management to boost revenues and reposition fiscal policy implementation on a consolidated and sustainable path”
He added that the MPC further noted a significant decline in inflation at the start of 2023 by more than 12 percent.
“The percentage of items in the CPI basket with inflation of more than 50 percent and above is receding which is an indication of a strong return to the disinflation path. This is also supported by core inflation which is also easing at a fast pace,” Dr Ernest Addison noted.