The Bank of Ghana (BoG) raised the monetary policy rate by 50 basis points to 30 percent.
This was established after the top bank reviewed economic patterns over the previous two months.
This indicates that the cost of borrowing at banks has climbed by 0.5 percent since the Central Bank’s last rate of 29.5 percent in May 2023.
Experts expect the rate to rise modestly owing to inflationary pressures.
Dr. Ernest Addison, Governor of the BoG, attributed the Central Bank’s decision to raise interest rates to an increase in inflation in his presentation following the 113th Monetary Policy Committee meeting.
“…Improving revenue mobilisation and matching spending with revenue inflows will be critical in moving on with fiscal cash elevation measures to build credibility, restore confidence, assist the disinflationary process, and anchor stability.” The first six months of implementation of the IMF-supported extended credit facility plan in 2023 are generally in line with the performance criteria set for June 2023. While the scheme called for a close to $100 million drawdown of the BoG, the BoG built reserves worth more than $1 billion.
“In terms of the monetary policy consultation provision, inflation is within the target zone as of June 2023, after dropping continuously from January to April.” “In May and June, headline inflation increased due to a range of reasons, including rising food costs, the introduction of new tax measures, and utility tariff adjustments,” he said.