Monetary Policy Committee of the Bank of Ghana (BoG) has kept the policy rate unchanged at 16 per cent.
Speaking to the media at a news conference Friday, the Governor of the Bank of Ghana, Dr Ernest Addison said the decision was as a result of some threats to the country’s economic growth and inflation outlook.
Dr Addison added that the Monetary Policy Committee was worried about the fiscal situation and its impact revenue, therefore the committee had to be careful in reviewing the policy rate. This is the fourth time this year that Bank of Ghana has kept its rate unchanged, since January this year.
This is the fourth time this year that the Bank of Ghana has kept the rate unchanged at 16 per cent since January 2019.
The development is expected to have little impact on the cost of credit reducing significantly. Impact of recent rebased inflation rate on monetary policy
There were expectations that recent rebased inflation rate of 7.8% and the pickup in GDP estimates should have impacted the policy rate, but Dr Addison noted that it might be too early to respond to these developments, adding that a little bit of time is needed to respond adequately to this development.
He however added that there might be the need to review its medium term outlook for inflation targeting going forward.
Credit conditions going forward
Dr Addison added that he is optimistic that following the banking sector clean up, cost of credit should start reducing very soon , adding that ” already the microfinance and savings and loans firms have started dropping their rates and we are looking forward to further reduction”