BoG Cuts Policy Rate to 21.5% in Bid to Boost Economic Recovery

Accra ,Ghana – September 17,2025 - The Bank of Ghana's Monetary Policy Committee (MPC) has reduced its benchmark policy rate by 350 basis points to 21.5%, citing a steady decline in inflationary pressures. The decision, made in a majority vote by MPC members, marks the second major cut this year as the central bank seeks to stimulate credit growth and support economic recovery.

The rate reduction comes despite concerns over currency stability and the potential risks associated with proposed upward utility tariff adjustments. In July 2025, the BoG had reduced the policy rate by 300 basis points from 28% to 25%, following a marginal hike in March 2025 from 27% to 28%.

According to Dr. Johnson Asiama, Governor of the Bank of Ghana, the rate cut is attributed to anticipated sound monetary policy reforms and ongoing fiscal consolidation efforts. "The view of the Committee was that inflation will continue to ease in the near term in the outlook," Dr. Asiama explained. "Given these considerations, the Committee in a majority decision decided to reduce the policy rate by 350 basis points to 21.5%."

The BoG's decision to lower the policy rate is expected to have a positive impact on the economy, particularly in terms of credit growth and economic recovery. However, the central bank remains cautious about potential risks, including currency stability and the impact of utility tariff adjustments on inflation.

The 126th MPC meeting concluded on Wednesday, September 17, 2025, underscoring the BoG's commitment to supporting economic growth while maintaining price stability.

Source – Lead News Online/Shiela Amerley Biala