Banking & Finance

Policy rate maintained at 29% – BOG

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The Bank of Ghana (BoG) has announced that it will keep its Monetary Policy Rate (MPR) at 29% for the second time this year.

The Governor of the Bank of Ghana, Dr. Ernest Addison, announced this decision during the 118th monetary policy meeting on Monday, May 27, 2024.

Dr. Addison stated that the decision to maintain the rate is intended to sustain the tight monetary policy stance and improve liquidity management operations.

He noted several positive economic indicators, including a substantial increase in foreign exchange reserves of about $2 billion since the IMF program began, significant progress in fiscal policy consolidation, and effective external debt restructuring.

The Governor also mentioned that the latest forecast shows a slight increase in inflation, driven by adjustments in transportation services. Nevertheless, he expressed confidence that inflation will stay within the monetary policy target.

This decision means commercial banks will continue to use the 29% rate as a reference for lending, potentially influencing borrowing costs and economic growth.

“The strong build-up is about 2 billion dollars since the beginning of the IMF programme, the strong dissemination process, significance process of the fiscal policy consolidation, positive current economic balances and the good process of the external debt structuring have all worked in concept to the exchange rate,” the governor said. 

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