A group photo with participants at the event
The Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has highlighted the tough policy trade-offs behind the country’s recent economic gains, stressing that the push to tame inflation has come at a significant cost.
Speaking at the Kwahu Business Forum Governor’s Roundtable, Dr. Asiama said Ghana’s economic progress in 2025 reflects deliberate but difficult decisions taken by the Central Bank amid a challenging global environment.
He noted that while macroeconomic indicators are showing signs of improvement, these gains have not come without sacrifice particularly in the area of monetary policy.
Dr. Asiama explained that reducing inflation, a major concern for the business community, required tight policy measures that have had far-reaching implications for credit conditions and overall economic activity.
He indicated that bringing inflation down has come at a cost pointing to the difficult balance as banks strike between stabilising prices and supporting growth.
The Governor further assured the business community that the Bank of Ghana remains committed to maintaining stability while creating conditions for sustainable growth.
Dr. Asiama also highlighted the stable exchange rate, among other strong macroeconomic data.
“The Cedi is stable and under control. The work we do is always about trade-offs, trying to strike the right balance.”
Dr. Asiama explained that achieving the right balance between policies affecting growth and inflation is crucial while acknowledging the positive impact of the strong macroeconomic performance in 2025 on the broader economy.
He, however, noted that the associated costs to the central bank last year was good but expensive for the central bank noting that it took a lot of money for the Central bank to mop up excess liquidity and reduce inflation down to 5.4% by December 2025.
He further explained that the central bank’s monetary operations aimed to drain excess liquidity, though the cost was high in 2025, he was confident that 2026 would be different.
“If you look at where inflation was at the end of December 2024 and where it is now, it wouldn’t involve the same level of resources to keep it low and stable going forward,” Dr. Asiama added.
The Governor also emphasised the importance of collaboration, assuring the business community that the central bank aims to strengthen the markets.
“When banks are strong, they can give more credit. Indeed, central banks are unique institutions playing a pivotal role in economic development. Central bank mandate is to maintain economic stability through fighting inflation to ensure that it remains low and stable.
“Stable inflation helps economies grow. The choice is difficult because the tools used to mop up excess liquidity from the economy come with heavy cost, which often impairs central bank balance sheet,” he said.
He mentioned that in the case of the Bank of Ghana, the BOG Bills, which commercial banks purchase are costly, especially looking at the impact of policy rate in the issuance of such bills.
By Ebenezer K. Amponsah