Banking BOG revises monetary policy rate to 24%

  • Published:
Governor of the Bank of Ghana, Dr. Henry Kofi Wampah play

Governor of the Bank of Ghana, Dr. Henry Kofi Wampah

24/7 Live - Subscribe to the Pulse Newsletter!

The Bank of Ghana has positioned its Monetary Policy Rate at 24 percent following the merger of its two key monetary policy instruments in controlling the country's inflation and money supply.

The Reverse Repo is  the  rate at which, effectively the  Bank of Ghana lends to commercial banks .

According to the central bank, it has merged its monetary policy rate and Reverse Repo as part of efforts to streamline its monetary operations toward a more transparent regime.

READ MORE: Cedi will stabilize in September -  Wampah declares

Governor of the Bank of Ghana, Dr. Henry Kofi Wampah said the monetary policy stipulation stay unchanged with the maximum threshold for banks remaining at 25%.  The therefore, does not expect banks to adjust their lending rates accordingly with the change in monetary policy regime, as the Bank of Ghana itself has kept the rate at which it lends to commercial banks.

"The merged rate will continue to be referred to as the Monetary Policy Rate and be positioned at 24 percent. This merger is to ensure transparency in the monetary policy stance of the Bank of Ghana," a statement issued by the central bank said.

At the end of the last Monetary Policy Committee meeting in July, the central bank maintained its policy rate - which signals interest rate trends - at 22 percent.

The central bank explained: "These changes, in effect, do not reflect a change in monetary policy stance, since the maximum lending rate of the Bank of Ghana remains unchanged at 25 percent".

READ MORE: BOG directs DKM Finance to raise GHC50 million or face liquidation

The Bank of Ghana has also introduced a seven-day Reverse Repo (lending) Facility, available to all banks to help them manage liquidity more effectively.

According to the Bank of Ghana, the Reverse Repo Facility will be the principal instrument through which the central bank injects liquidity into the banking system during periods of general liquidity shortage.

The attempt by the Bank of Ghana to have absolute control of money circulating in the country reflects the continued rise in inflation, which is of grave concern to managers of the economy and necessitates the Bank of Ghana reducing demand for credit facilities.

Inflation for the month of June increased to 17.1 percent, up marginally from 16.9 percent recorded in May this year. The depreciating cedi has fueled import inflation, threatening the government's end of year inflation target of 13.7 percent.

Do you ever witness news or have a story that should be featured on Pulse Ghana?
Submit your stories, pictures and videos to us now via WhatsApp: +233507713497, Social Media @pulseghana: #PulseEyewitness & DM or Email:

Recommended Articles

Recommended Videos

Top Articles

1 Banking In Ghana Ghanaian banks resist the use of crypto currencybullet
2 MoMo Ghanaians to make int’l payments with mobile money as MTN...bullet
3 2018 World Happiness Report Somalia is a happier place to live than...bullet
4 Menzgold Ghana Don't deposit money with Menzgold – BoG cautions...bullet
5 Police Service Debt Vodafone cuts off line to Ghana Police...bullet
6 Nima Flagstaff House We'll return to vote for you in 2020 -...bullet
7 Nepotism In Ghana NLA boss awards sister-in-law 11 contracts...bullet
8 Prisons Recruitment Prison Service extends recruitment...bullet
9 Electricity Tariffs PURC gazettes tariff reductionbullet
10 Monument of founder of Accra Mall, Joseph...bullet

Top Videos

1 Support Finance minister buys Kantanka carbullet
2 New Discovery Ghana discovers new mineral, lithium in commercial...bullet
3 Money Alert Meet Africa's richest womanbullet
4 Forbes 2018 Africa's billionaires rich listbullet
5 Dr Joseph Siaw Agyepong Nobody can collapse my company – JOSPONGbullet
6 Bozoma Saint John 10 quotes from Uber top official, Bozoma,...bullet
7 Tech 6 reasons you should buy an iPhone SE instead of any of...bullet
8 Plane Crash Starbow suspends operations following plane crashbullet
9 Entrepreneurship How To Get Ready To Get Started |...bullet
10 Entrepreneurship How to be resourceful as an entrepreneurbullet