Dr. Johnson Asiama
The Bank of Ghana (BoG) has reduced its Monetary Policy Rate by 350 basis points from 21.5% to 18 percent marking one of the lowest policy easing decisions in recent years.
The Governor of the Bank of Ghana, Dr. Johnson Asiama, who announced this yesterday at a media briefing said the decision stems from improved macroeconomic conditions and anticipated significant decline in inflation by the end of the year.
He said in taking the policy decision, the view of the Committee was that overall macroeconomic conditions have broadly improved given the anticipated significant decline in inflation by the end of the year as well as the tight monetary policy stance.
With the significant build-up of reserves which is providing anchor for exchange rate stability, the Bank projects a continued stable inflation profile around the target and well into the first half of 2026.
“Given these considerations, the Committee, by a majority decision, voted to lower the Monetary Policy Rate further by 350 basis points to 18.0 percent,” he said.
According to the Central Bank, in the global context, growth has been steady despite major policy shifts, supported by easing financial conditions and fiscal stimulus in many countries as the outlook remains fragile amid a volatile trade environment and ongoing geopolitical tensions.
Dr. Asiama also stated that though the pace of ease in inflation remains uneven, especially for countries adversely impacted by the volatile trade environment, Global headline inflation has eased further on the back of lower energy and food prices.
On the domestic front, growth continues to gain momentum following the strong GDP outturn of 6.3 percent in the first half of the year. The Composite Index of Economy Activity (CIEA) is also posting strong gains. At the end of September, the Bank’s updated CIEA recorded a strong growth outturn of 9.6 percent, compared to 2.9 percent growth for the corresponding period of 2024.
The Bank of Ghana added that inflation decline in the year has been steady and on target from 23.5 percent in January 2025 with a headline inflation that has eased to the Bank’s central target of 8.0 percent in October.
The Governor noted that the sustained disinflation has been driven by the continued maintenance of a tight monetary policy stance, sustained fiscal consolidation efforts, a stable currency, and relative improvement in food supply.
Touching on the interest rate, Dr. Asiama said it has generally declined in line with the reduction in the Monetary Policy Rate with interbank weighted average rate declined to 21.0 percent in October 2025, from 27.7 percent in the same month of 2024.
By Ebenezer K. Amponsah