Bank of Ghana Expected to Deliver Second 300-Basis-Point Rate Cut

ACCRA— Ghana’s central bank is expected to deliver a sharp interest-rate cut at its September meeting, extending an easing cycle that began in July as inflation cools and the cedi strengthens.

Economists anticipate the Monetary Policy Committee will lower the policy rate by 300 basis points, to 22%, after a similar move two months earlier. Such a step would mark one of the most aggressive rate-cutting paths among African central banks this year.

The move is supported by a string of positive indicators. Inflation fell to 11.5% in August, its lowest since late 2021 and below the government’s year-end target of 11.9%. Meanwhile, the cedi has appreciated 42.6% against the U.S. dollar year-to-date, aided by strong external balances. Ghana posted a $5.6 billion trade surplus and a $3.4 billion current-account surplus in the first half of 2025, while reserves rose to $11.1 billion by June.

With the benchmark rate currently at 25%, Ghana’s real interest rate remains among the highest globally—estimated at 13.5% in August and projected to climb above 15% without a cut. Analysts say that leaves room for the Bank of Ghana to ease policy while maintaining monetary discipline.

If enacted, the reduction would further lower borrowing costs, potentially spurring credit growth in an economy that expanded 6.3% in the second quarter. Lower rates could also bolster business sentiment, particularly as inflation heads closer to single digits.

Still, risks remain. A faster-than-expected pickup in demand could reignite price pressures, while external shocks—from global oil markets to shifts in U.S. monetary policy—may test Ghana’s improving fundamentals.

The anticipated decision underscores the central bank’s pivot from crisis-era tightening toward supporting growth as fiscal and monetary reforms take hold under its IMF-backed program.

Now to your follow-up questions (FAQs):

1. How might this rate cut affect the average Ghanaian?

   • Lower lending rates could ease the cost of personal and business loans, improving access to credit. Mortgage and consumer financing might become more affordable, though the benefits may take time to filter through given structural limits in Ghana’s credit market.

2. Impact on borrowing costs:

   • Commercial banks typically adjust lending rates following policy shifts. A 300bp cut could reduce effective lending rates by several percentage points, making it cheaper for firms to finance expansion and households to borrow for major purchases.

3. Risks to Ghana’s outlook:

   • Inflation could rebound if demand rises faster than supply capacity. External shocks, such as a reversal in commodity prices or tighter global financial conditions, could pressure the cedi and reserves. Additionally, fiscal slippage under the IMF program could weaken investor confidence.

Source: Accra Street Journal

Last Updated on March 9, 2026 by Samuel Kwame Boadu

Samuel Kwame Boadu

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.

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