• Friday, March 01, 2024
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BusinessDay

Ghana central bank cuts policy rate as inflation eases

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Ghana’s central bank lowered its main interest rate, opens new tab by 100 basis points to 29% on Monday, its first rate cut since 2021, after inflation fell for the fifth consecutive month in December.

Ghana has been restructuring its debts as it tries to emerge from its worst economic crisis in a generation that saw inflation rocket beyond 50% in annual terms in late 2022.

But price pressures eased considerably over the second half of 2023, falling to 23.2% year-on-year in December, opens new tab from 26.4% in November and 35.2% in October.

Bank of Ghana Governor Ernest Addison told a news conference that bank officials now forecast inflation would drop to 13%-17% by the end of the year and to 6%-10% by 2025.

The central bank targets inflation of 8% with a margin of error of 2 percentage points either side.