The Bank of Ghana has decided to keep its policy rate, the interest rate it charges to commercial banks, at 29.5%.
The bank’s Monetary Policy Committee (MPC) announced this decision after its 112th meeting, which took place last week.
The MPC said that the main reason for maintaining the policy rate was the downward trend in inflation, which measures the general increase in prices of goods and services. “The headline inflation has fallen significantly from more than 12.0% at the start of the year.
The number of items in the CPI basket with inflation above 50% is also reducing, showing a strong return to the disinflation path”, said Dr. Ernest Addison, the Governor of the Bank of Ghana, at a press conference.
He added that the bank’s tight monetary policy through extra liquidity management operations to deal with excess money supply in the market, the relative stability of the Ghanaian cedi, and the easing of fuel prices have supported the disinflation process.