Dr. Johnson Asiamah
The Bank of Ghana (BOG) has maintained its Policy rate at 28% as a result of the high level of inflation relative to its medium term target.
Governor of the Bank of Ghana, Dr. Johnson Asiamah who announced this at a press briefing at its 124th Monetary Committee Meeting in Accra said headline inflation has declined consecutively in the first four months of the year by 2.6 percentage points to 21.2 percent in April 2025, due to both food and non-food inflation.
That, he explained, is attributed to a number of factors including tight monetary policy stance, stepped-up liquidity sterilisation efforts, downward revisions in ex-pump petroleum prices, and exchange rate stability.
Dr. Asiama also mentioned that Bank’s core inflation measure, which excludes energy and utility prices, as well as inflation expectations of consumers, businesses, and the banking sector point to easing inflationary pressures.
But according to the governor, “despite these positive developments, the Committee observed that the current level of inflation remains high relative to the medium-term target and will require maintaining the tight stance to reinforce the disinflation process. Under the circumstances, the Committee, by a unanimous decision, maintained the policy rate at 28.0 percent”.
“The latest forecast points to continued easing of inflationary pressures on the back of tight monetary policy stance, exchange rate stability, and fiscal consolidation. Inflation is expected to ease faster towards the medium-term target in the first quarter of 2026 as opposed to the second quarter as earlier envisaged, barring unanticipated shocks,” he stated.
Dr. Asiama also stated that the strong performance of the cedi against the major trading currencies are driven by a combination of factors, such as tight monetary policy stance, ongoing fiscal consolidation, record reserve accumulation, strict enforcement of foreign exchange market rules, and improved market sentiment.
He further indicated that in May 21, 2025, the cedi had appreciated against all the major currencies, thus 24.1 percent against the US dollar, 16.2 percent against the British pound, and 14.1 percent against the euro.
By Ebenezer K. Amponsah