Dr. Ernest Addison, Governor of the Bank of Ghana (BoG), explained the Monetary Policy Committee’s (MPC) decision to maintain the policy rate at 29 percent during the 119th press conference on Friday, July 26.
He stated that domestic price developments face uncertainty due to recent exchange rate pressures, increased utility tariffs, and higher ex-pump fuel prices. These factors, he noted, have led to a slightly elevated inflation outlook for the year.
He mentioned that although inflation is expected to stay within the target range for the year, the risks are slightly tilted to the upside.
“This will require maintaining the strong monetary policy stance supported by strong fiscal consolidation efforts including remaining vigilant to ensure that the end year inflation objectives are achieved,” Dr Addison said.
He added “Given these considerations, the Committee decided to maintain the policy rate at 29 percent.”
The decision follows a comprehensive review of the country’s macroeconomic conditions over the past two months.
Keeping the policy rate stable is anticipated to prevent changes in commercial banks’ lending rates to businesses, ensuring a stable financial environment for corporate borrowers.
