The Monetary Policy Committee of the Bank of Ghana (BoG) has increased the policy rate by 100 basis points to 14.5 percent. The policy rate is the rate at which the central bank lends to commercial banks inn the country.
Announcing the rate in press statement the committee said Headline inflation has risen consistently from the low of 7.5 percent in May 2021 to 11.0 percent in October driven by both food and non-food price increases.
“In addition, all the Bank’s core measures of inflation have increased, indicating broad-based underlying inflation pressures, with the potential of de-anchoring inflation expectations. Currently, headline inflation is above the upper limit of the medium-term target band and the Committee noted significant risks to the inflation outlook.
The committee explained that these risks include rising global inflation, high energy prices, uncertainties surrounding food prices and investor behaviour.
“The Committee further noted that these elevated inflationary risks, require prompt policy action to re-anchor inflation expectations to safeguard the central bank’s price stability objective,” the statement said.
