BoG maintains policy rate at 29%

The Bank of Ghana (BoG) has maintained its Monetary Policy Rate (MPR) at 29 per cent.

This comes as the International Monetary Fund (IMF) warned Central Banks to be careful when cutting interest rates as looser monetary policy could push inflation up further.

This is the first time the BOG is maintaining the rate in 2024.

At its 117th monetary policy announcement on Monday, March 25, 2024, the Governor of the Bank of Ghana, Dr. Ernest Addison cited the need to closely monitor the current inflation trend as risks remain elevated.

“External sector conditions remain positive with improving reserve buffers. The exchange rate came under strong pressure in the first few months of the year. The banking sector remains stable despite the elevated credit rates.

“Banks’ liquidity and profitability positions have continued to improve. Out of the total of 23 banks, more than half have fully capitalized and have no need for recapitalization.

He added, “Most of the outstanding banks have met more than two-thirds of the required capitalization over a three-year period within one year as of the end of 2023. Fiscal policy implementation so far has been consistent with targets under the IMF support programme.

“Although the primary fiscal balance target for 2023 was attained, the fiscal assessment is made on a commitment basis and vigilant to ensure commitment control is effective in 2024.

From 2023, the pace of inflation has slowed in the first two months of the year. The latest inflation forecast suggests a slightly elevated profile.”

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