The Governor of the Bank of Ghana, Dr. Johnson Asiama, has stressed that while some progress has been made in controlling inflation, further efforts are required to bring it down to the central bank’s desired levels. Speaking after the 123rd Monetary Policy Committee meeting, he highlighted that future rate changes would depend on evolving economic conditions and the effectiveness of ongoing policies. He also emphasized that sustained actions are needed to manage price stability and ease the cost of living pressures on both businesses and households.
As of February 2025, Ghana’s inflation rate had decreased to 23.2%, down from the peak of 54.1% in December 2022. This decline was largely attributed to tight monetary policies, improved food supply conditions, and relative stability in the foreign exchange market. Despite this progress, inflation remains above the Bank of Ghana’s target range of 6-10%, prompting the need for continued action to address the underlying causes.
The Governor also noted that the disinflation process was ongoing, but risks remain. To maintain these gains, he stressed the importance of keeping fiscal and monetary discipline while tackling supply-side challenges that continue to drive inflationary pressures. The Bank of Ghana has already raised its policy rate by 100 basis points to 28.0% to help curb inflation and ensure macroeconomic stability.
While inflation persists, Ghana’s economy saw stronger-than-expected growth in 2024, with real GDP expanding by 5.7%. However, the government’s fiscal deficit widened significantly, contributing to liquidity challenges. This situation has led the central bank to tighten monetary policy further to stabilize the economy.
Source: citi newsroom