The Bank of Ghana’s Monetary Policy Committee (MPC) raised the monetary policy rate by 150 basis points, to 29.5 percent.
The prime rate indicates the rate at which the Central Bank will lend to commercial banks and is of great relevance to businesses.
As a result, it affects the typical lending rates for loans to people and enterprises.
Despite recent moderation and deceleration of inflationary pressures, the partial stabilization of the local currency, and short-term expectations, Governor of the Central Bank Dr. Ernest Addison mentioned possible dangers to the inflation outlook in his speech to the media.
In order to put the economy back on the path of recovery and long-term growth, this will be crucial. Even though headline inflation has slightly decreased twice in a row, it still remains high when compared to the medium-term target of 8+ or -2%.
The Bank of Ghana must raise the monetary policy rate in order to firmly position the economy on the stable side.
