The Bank of Ghana (BoG) on Wednesday cut its benchmark lending rate by 350 basis points to 18% — its third straight reduction and a cumulative 1,000-basis-point easing this year — as inflationary pressures remained subdued. The rate is also the lowest since April 2022.
The decision, taken by a majority of members at the Monetary Policy Committee’s 127th meeting in Accra, aligns with market expectations and reflects the bank’s confidence that price growth will remain contained in the near term.
In a press briefing following the policy meeting, Governor Johnson Asiama told reporters that real interest rates — adjusted for inflation — were still high enough to give policymakers room to ease without losing grip on price stability.
“The prevailing high real interest rates provided some scope to ease monetary policy to boost the growth recovery efforts further,” Asiama said. “The bank projects a continued stable inflation profile around the target and well into the first half of 2026.”
The central bank also confirmed that it will shift to using 14-day bills to manage liquidity and improve the transmission of monetary policy.
Phoebe Afful, a Ghana-based Senior Projects Evaluation Officer at the Petroleum Commission, noted on LinkedIn that lower borrowing costs will improve access to credit for businesses and households, with inflation trending at eight percent — well within the target band — creating room for growth.
“The cedi remains stable, reinforcing confidence in Ghana’s macroeconomic outlook. This decision signals a strong commitment to stimulating economic activity while maintaining stability. For businesses, this is the time to rethink financing strategies and seize growth opportunities,” Afful said.
Cedi gains, gold rally cool prices
Inflation in Ghana, which peaked above 54% in December 2022, has steadily fallen back into the central bank’s 6–10% target range.
By October 2025, prices eased to eight percent, the lowest in over four years, supported by a combination of improved fiscal management, a stronger cedi, and a global rally in gold prices.
Bloomberg data shows that the local currency appreciated by about 30% against the US dollar in 2025%, making it one of the best-performing currencies this year.
The government forecasts a primary budget surplus of 1.5% of gross domestic product in 2026, while the overall deficit is forecast to narrow to 2.2% from a projected 2.8% this year.
Economic growth is also expected to accelerate at 4.8% in 2026, up from 4% in 2025.
Regional trends
Ghana’s easing cycle mirrors similar moves by regional peers.
South Africa’s Reserve Bank, last week, reduced its benchmark lending rate by 25 basis points to 6.75%, the lowest since October 2022 following Zambia’s central bank 25 basis points cut earlier in the month. Both moves were also motivated by slowing inflation and efforts to support economic recovery.
With the BoG easing cycle gaining momentum, inflation trending downwards and the cedi strengthening, analysts see a clearer path to credit for firms and households.
Ghana could also be entering a more durable period of economic stability as price growth continues to slow.
“We are now back in the high-teens policy rate territory, last seen in early 2022, before inflation and a currency crisis pushed rates above 30%,” said Theophilus Acheampong, a UK-based Economic and Policy Analyst.
