https://www.polity.org.za
Deepening Democracy through Access to Information
Home / News / All News RSS ← Back
Export|generation|Gold
Export|generation|Gold
export|generation|gold
Close

Email this article

separate emails by commas, maximum limit of 4 addresses

Sponsored by

Close

Article Enquiry

Bank of Ghana keeps main rate unchanged over inflation concerns

Close

Embed Video

Bank of Ghana keeps main rate unchanged over inflation concerns

26th July 2024

By: Reuters

SAVE THIS ARTICLE      EMAIL THIS ARTICLE

Font size: -+

Ghana's central bank held its main interest rate steady at 29% for the third meeting in a row on Friday, saying a strong monetary stance was needed due to uncertainty over the inflation outlook.

Economists polled by Reuters before Friday's announcement predicted a 50-basis-point cut in its main rate. They expect Ghana to finish the year with interest rates 200 basis points lower.

Advertisement

"Even though inflation is expected to remain within the target year band, the risks have tilted slightly on the upside," Bank of Ghana Governor Ernest Addison told a news conference.

"This will require maintaining a strong monetary policy stance, supported by strong fiscal consolidation efforts," Addison said.

Advertisement

He added that there was some uncertainty regarding the inflation path for the year given the recent exchange rate pressures, upward adjustment in utility tariffs, and increases in export fuel prices.

Ghana's consumer inflation slowed last month to 22.8% year on year in June from 23.1% in May, but it remains well above the central bank's 8% target with a margin of error of 2 percentage points either side.

Finance minister Mohammed Amin Adam said on Tuesday the West African nation would be able to reach the target for the year of 15% by the end of 2024, adding that its economy was rebounding faster than expected.

"The central bank is clearly reacting to the stalling disinflation during the first half of 2024, which has put both its short- and medium-term inflation targets at risk," said Leslie Dwight Mensah, economist and research fellow at the Institute for Fiscal Studies in Accra.

"The decision has also been made with an eye on the cedi exchange rate, which has had a bad run in recent months and remains prone to depreciation given the economy's limited foreign financing options," Mensah said.

The West African cocoa, gold and oil producer has been restructuring its $30 billion debt in an attempt to emerge from its worst economic crisis in a generation.

Central bank governor Addison said economic activity in Ghana remained resilient in the context of a generally tight policy stance.

Ghana's trade balance improved in the first half of the year, driven by higher exports of gold and crude oil, he said.

Strong gold output, and soaring prices helped Ghana earn more from the precious metal in the first half of 2024.

"The value of gold exports increased by 46.4% to $5.04-billion, while earnings from crude oil increased to $2-billion from $1.7-billion in the same period last year," Addison said.

EMAIL THIS ARTICLE      SAVE THIS ARTICLE

To subscribe email subscriptions@creamermedia.co.za or click here
To advertise email advertising@creamermedia.co.za or click here

Comment Guidelines

About

Polity.org.za is a product of Creamer Media.
www.creamermedia.co.za

Other Creamer Media Products include:
Engineering News
Mining Weekly
Research Channel Africa

Read more

Subscriptions

We offer a variety of subscriptions to our Magazine, Website, PDF Reports and our photo library.

Subscriptions are available via the Creamer Media Store.

View store

Advertise

Advertising on Polity.org.za is an effective way to build and consolidate a company's profile among clients and prospective clients. Email advertising@creamermedia.co.za

View options

Email Registration Success

Thank you, you have successfully subscribed to one or more of Creamer Media’s email newsletters. You should start receiving the email newsletters in due course.

Our email newsletters may land in your junk or spam folder. To prevent this, kindly add newsletters@creamermedia.co.za to your address book or safe sender list. If you experience any issues with the receipt of our email newsletters, please email subscriptions@creamermedia.co.za