The Ghana Union of Traders Association (GUTA) has commended the Bank of Ghana’s bold move to slash its policy rate by 300 basis points, saying it offers a significant lifeline for traders and businesses.
The central bank’s decision, announced on July 30, reduces the policy rate from 28% to 25%—the steepest single cut on record. Analysts had largely expected a 200bp cut, but the Monetary Policy Committee (MPC) took a more aggressive step to signal confidence in Ghana’s improving macroeconomic environment.
When interest rates come down, borrowing becomes more affordable, and that fosters the right environment for businesses to grow,” said Dr. Joseph Obeng, President of GUTA, in an interview sighted by Accra Street Journal.
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A Strategic Shift by the Central Bank
According to Dr. Obeng, the Bank of Ghana has taken a deliberate and measured approach. While promoting economic recovery, the central bank has also remained vigilant to avoid re-igniting inflation.
“They’re striking a careful balance. We see signs of recovery—fiscal consolidation, cedi stability, and falling inflation. These create the right conditions for interest rates to drop further in the coming months,” he noted.
Ghana’s inflation rate fell sharply from 18.4% in May to 13.7% in June 2025, marking its lowest level in over three years. With inflation cooling, fiscal discipline improving, and foreign reserves recovering, the central bank had enough room to shift from a tight monetary stance to a more growth-supportive position.
Businesses Still Watching the Banks
Despite the optimism, GUTA emphasized that the full benefits of the policy rate cut depend on whether commercial banks translate the reduction into lower lending rates.
“It’s now up to the banks. If they adjust their rates downward, traders and SMEs will finally get the breathing room to invest and expand,” Dr. Obeng stated.
Economic Analysts Agree
Experts believe this policy shift could reduce commercial interest rates within weeks. It is expected to boost investor confidence, unlock new credit, and enhance private sector activity.
Conclusion:
For GUTA and many within Ghana’s business community, the central bank’s decision is timely. If supported by commercial banks, it could mark a turning point in Ghana’s efforts to stimulate economic growth, empower traders, and create jobs.
“At the end of the day, this is a good move for Ghana’s economy,” Dr. Obeng affirmed.
Last Updated on July 31, 2025 by Samuel Kwame Boadu
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Samuel Kwame Boadu is a Ghanaian media entrepreneur and storyteller with a passion for amplifying urban voices and uncovering everyday truths. He is the Editor-in-Chief and Founder of Accra Street Journal, a dynamic digital platform dedicated to capturing the pulse of Ghana’s capital—its people, culture, challenges, business, sports and innovations.
