MPC holds 14% policy rate as inflation risks mount

The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) decided to maintain the monetary policy rate at 14 percent during their latest meeting in September 2026. This decision was made despite a recent increase in headline inflation, which stood at 5 percent in August, up from 4.6 percent in July.

In their assessment, the Committee found the balance of risks to inflation and economic growth to be broadly balanced, citing resilient domestic economic activity, higher international energy prices, supply-chain disruptions, and geopolitical tensions. They noted that Ghana's economy continued to record strong activity in the first half of the year, with Real GDP growth at 6 percent in the second quarter of 2026, compared to 6.6 percent in the same period of 2025.

However, the inflation situation remained a concern. While food inflation declined slightly to 3 percent, non-food inflation rose to 6.8 percent, primarily due to tariff adjustments and high crude oil prices. The MPC also expressed concern about global risks, including geopolitical tensions, higher energy prices, and global supply-chain constraints. These factors could further pressure domestic inflation.

On the positive side, domestic financial conditions improved, with interest rates on government short-term instruments and bank lending rates falling. Private sector credit growth rebounded strongly to 35.5 percent in August 2026, from 13.3 percent in August 2025, suggesting increased demand for credit. Despite these factors, the MPC maintained their medium-term target inflation range of 8 percent, plus or minus two percentage points.