Ghana Central Bank Meets Amid Inflation Crisis

Ghana’s central bank will meet today to discuss monetary policy adjustments. The current benchmark interest rate was raised to 17%

Ghana Central Bank inflation

The Central Bank of Ghana meets today to discuss combatting rapidly rising inflation. Photo: Zohra Bensema/ Reuters

Ghana’s central bank will meet today to discuss monetary policy adjustments.

The current benchmark interest rate was raised to 17% in March 2022, up from 14.5% earlier this year, in order to stabilize prices. The move was ineffective as inflation continued to rise and economic growth slowed.

The country’s monetary policy committee will seek to further alter the country’s interest rate to manage the rampant inflation, which is now at 23.6%. Following disruptions in the global food supply chain, as well as increased oil prices and Russia’s invasion of Ukraine.

Dr. Ernest Addison, Governor of the Bank of Ghana, is expected to lead the decisive decision making process that will influence the new cost of credit. Any further attempts to increase the interest rate will drive up the cost of credit, stifling investment. Despite this, the government will likely raise the interest rate again in an attempt to slow down the rapid rise of commodity prices which threatens to send the West African country into economic crisis. To mitigate the effects of slowed growth, the government will have to cut expenditures as revenues will fall short of expected projections.

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