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Inflation rises to 5% as Bank of Ghana’s Monetary Policy Committee reviews policy rate

The Crystal Clear LENS 4 days ago 2 min read

Bank of Ghana Governor Dr. Johnson Pandit Asiama has identified rising inflation as a key issue for the Monetary Policy Committee (MPC) as it reviews the 14 per cent policy rate.

Headline inflation rose to 5.0 per cent in August, from a low of 3.2 per cent in March.

Dr. Asiama highlighted the development as the MPC opened its 132nd meeting on September 23, 2026.

“The first is the inflation trajectory. Headline inflation has risen from its March low of 3.2 percent to 5.0 percent in August, a cumulative increase of 1.8 percentage points in five months,” he said.

Inflation remains below the lower limit of the Bank of Ghana’s 8±2 per cent target band. However, Dr. Asiama said the upward trend requires close attention.

“The level remains well below the lower bound of the target band, but the direction has been upward, and the question before the Committee is whether the expected rise over the coming months will be a one-off adjustment to higher energy prices and administered tariffs, or the start of more persistent pressure that could unsettle expectations.”

At its previous meeting in July, the MPC unanimously maintained the Monetary Policy Rate at 14.0 per cent.

The Committee considered the rate appropriate to guide inflation towards its target. It also wanted more time to assess the impact of earlier policy decisions.

Dr. Asiama said those decisions were still working through the economy, particularly changes to the Cash Reserve Ratio (CRR) regime.

“Two months on, that transmission is still ongoing; the banks are reallocating resources, and the Middle East conflict has not eased; it is taking on different dimensions,” he said.

The MPC will therefore assess whether the balance of risks has changed enough to require a different policy response.

“The Committee’s task during this meeting is to judge whether the balance of risks has shifted enough to warrant a different policy response, or whether there remains a case for still maintaining the policy rate at its current level,” Dr Asiama said.

Ghana’s broader domestic economy, however, remains stable.

Real Gross Domestic Product grew by 6.0 per cent in the second quarter, driven mainly by the services and information and communications technology sectors.

The cedi has also remained relatively stable. This has helped contain imported inflation and ease inflation expectations.

Despite these gains, higher energy prices and other domestic cost pressures remain risks for the MPC to consider.

The 132nd MPC meeting is also the first to be held under Ghana’s new 36-month Policy Coordination Instrument (PCI) with the International Monetary Fund.

The IMF Executive Board approved the programme on July 27, 2026.

Dr. Asiama said the new programme marks Ghana’s transition from crisis stabilisation to a consolidation phase. He also stressed the importance of maintaining policy credibility during the new phase.