The Bank of Ghana (BoG) has maintained its policy rate at 17 per cent.
This was announced by the Governor of the BoG Dr Ernest Addison on Monday (November 26, 2018). According to him, they kept the benchmark interest rate unchanged to help stabilise the Ghana Cedi which has faced some pressure in recent weeks.
He added that this was also to protect the West African economy against possible global pressures on emerging economies.
“The latest assessment shows that there are underlying pressures including risks in the continuing escalation of global trade pressures, steady rise in global inflation, further hike in U.S interest rates and a strong U.S dollar,” Dr Addison said.
Ghana, a major exporter of cocoa, gold, and oil, is in its final year of an International Monetary Fund (IMF) bailout programme.
The erstwhile Mahama administration started the $918 million aid programme to reduce debt and cut inflation to 8 percent, plus or minus 2 percentage points by the end of the year.
By the beginning of October, the cedi was trading at almost GHC 5 to a dollar. The Institute of Statistical, Social and Economic Research (ISSER) warned that the Cedi was bound to depreciate further depreciate against the US dollar in the coming months.
The cedi depreciated by 5.3 per cent in the first six months of 2018, compared to 3.3 per cent in the first half of 2017.
Meanwhile, the Cedi has depreciated by 7.8 percent since January. This is above the bank’s end-year projection of less than 5 percent.
On the Minimum Capital; Requirement (MCR), Dr Addison announced that most commercial banks in the country were close to meeting the central bank’s new MCR of GHC 400 million by end of 2018.