Bank of Ghana maintains policy rate at 29%

The Monetary Policy Rate (MPR) of the Bank of Ghana (BoG) remains at 29%.

This occurs in the wake of the International Monetary Fund’s (IMF) caution that central banks should exercise caution when reducing interest rates since doing so might result in even higher inflation.

The BOG is keeping the rate in 2024 for the first time.

Dr. Ernest Addison, the governor of the Bank of Ghana, stated that it is important to closely watch the present inflation trajectory since risks are still high during the institution’s 117th monetary policy statement on Monday, March 25, 2024.

“External sector conditions remain positive with improving reserve buffers. The exchange rate came under strong pressure in the first few months of the year. The banking sector remains stable despite the elevated credit rates.

“Banks’ liquidity and profitability positions have continued to improve. Out of the total of 23 banks, more than half have fully capitalized and have no need for recapitalization.

He added, “Most of the outstanding banks have met more than two-thirds of the required capitalization over a three-year period within one year as of the end of 2023. Fiscal policy implementation so far has been consistent with targets under the IMF support programme.

“Although the primary fiscal balance target for 2023 was attained, the fiscal assessment is made on a commitment basis and vigilant to ensure commitment control is effective in 2024.

From 2023, the pace of inflation has slowed in the first two months of the year. The latest inflation forecast suggests a slightly elevated profile.”

Source: Ghanatodayonline.com