BoG Governor says GH₵17bn stabilization effort drives inflation down to 3.3%
Governor of the Bank of Ghana, Dr Johnson Pandit Asiama, has told Parliament that the central bank’s GH¢17 billion stabilisation measures in 2025 played a crucial role in achieving one of the sharpest declines in inflation in Ghana’s recent history.
Addressing the Parliamentary Committee on Economy and Development on Monday, Dr Asiama explained that when he assumed office, inflation remained high while monetary conditions were not sufficiently tight to bring prices down within a reasonable timeframe.
“A key challenge at the time was the presence of excess structural liquidity in the banking system, which weakened the transmission of monetary policy and allowed inflationary pressures to persist,” he said.
To address the situation and strengthen the effectiveness of monetary policy, the Bank of Ghana intensified its open market operations by absorbing excess liquidity from the banking system. The central bank also paid interest on the absorbed funds to prevent excessive money in circulation from fuelling inflation.
“Liquidity management through open market operations is a core function of central banks around the world and is one of the primary tools used to ensure that monetary policy decisions are effectively transmitted through the financial system,” Dr Asiama explained.
He said the measures have helped restore stability to the economy and rebuild confidence within the financial markets.
According to the Governor, inflation has dropped significantly from 23.8 percent in December 2024 to 3.3 percent in February 2026, representing one of the lowest levels recorded in recent years.
“Lower inflation means that the wages and incomes of Ghanaians are no longer being rapidly eroded by rising prices,” he said.
Dr Asiama added that the cedi has stabilised while interest rates have begun to decline, easing borrowing conditions for businesses and households and boosting overall economic confidence.
He also noted that Ghana’s external buffers have improved considerably, with gross international reserves rising to US$13.8 billion, providing about 5.7 months of import cover.
In line with the Bank of Ghana’s commitment to transparency, the Governor disclosed the financial cost associated with the stabilisation measures, indicating that liquidity management operations resulted in interest expenses of about GH¢17 billion.
“The financial effects that will be reflected in the Bank's accounts are the accounting counterpart of the stabilization benefits now being realized across the Ghanaian economy,” he told Members of Parliament.
Dr Asiama stressed that the measures were necessary to restore the effectiveness of monetary policy, ease inflationary pressures and stabilise the exchange rate.
“For ordinary Ghanaians, the most important signal of recovery is simple,” he said. “Prices are stabilizing, the cedi is steadier, and the economy is moving back toward normal.”
He assured Parliament that the Bank of Ghana remains committed to maintaining price stability and supporting the conditions required for sustainable economic growth.