BoG increases Monetary Policy Rate to 29.5 percent amid high inflation

The Bank of Ghana (BoG) has announced an increase in the Monetary Policy Rate by 150 basis points.

This pegs the Monetary Policy Rate at 29.5 percent.

The new rate has been announced after a meeting by the Bank of Ghana’s Monetary Policy Committee (MPC).

“Headline inflation has declined marginally for two consecutive months, but continues to remain relatively high compared to the medium-term target of 8±2 percent.

“To place the economy firmly on the path of stability and reinforce the pace of disinflation, it is important that the monetary policy stance be tuned further to reanchor inflation expectations towards the medium-term target.

“Given these considerations, the MPC decided to increase the Monetary Policy Rate by 150 basis points to 29.5 percent,” parts of a press release from BoG said on Monday, March 27.

At the Monetary Policy Committee meeting, a decision was taken to reset the Cash Reserve Ratio on domestic currency deposits for banks from 12 percent to 14 percent, effective 13th April 2023.

In addition, the Bank will step up liquidity management operations to address excess liquidity conditions in the market. The Committee will continue to monitor developments in the banking sector and deploy other macroprudential tools to ensure financial stability.

Meanwhile, the next Monetary Policy Committee meeting is scheduled for May 17 - 19, 2023.

The meeting will conclude on Monday, May 22, 2023, with the announcement of the policy decision.