Interest rates development continues to reflect more expansionary monetary policy environment – BoG

In August 2026, interest rate developments in Ghana continued to show the impact of a more expansionary monetary policy environment. Interest rates, both policy and market-based, decreased compared to August 2025, as inflationary pressures eased and macroeconomic conditions improved. The Bank of Ghana (BoG) reported that real interest rates remained positive throughout this period.

The Monetary Policy Rate (MPR) dropped significantly, from 25.0% in August 2025 to 14.0% in August 2026. This reduction of 11 percentage points was a result of the cumulative monetary easing measures implemented by the BoG in response to the moderation in inflation and improvements in macroeconomic fundamentals. A similar trend was observed in the Interbank Weighted Average Rate (IWAR), which fell from 23.3% in August 2025 to 10.2% in August 2026.

The decrease in the policy rate led to lower lending rates across banks, with the average lending rate falling from 24.2% in August 2025 to 15.9% in August 2026. This adjustment reflects the transmission of the policy rate reduction to market rates. Treasury bill rates also declined sharply during the same period, with the 91-day, 182-day, and 364-day rates decreasing to 5.4%, 7.3%, and 12.2%, respectively, compared to 10.3%, 12.3%, and 13.1% a year earlier.

This decline was attributed to sustained investor demand at the short end of the curve, improved inflation expectations, and the government's ongoing efforts to reduce domestic financing costs.

However, long-term government securities, such as 2-year, 3-year, 5-year, 6-year, 7-year, 10-year, 15-year, and 20-year bonds, experienced only minor changes in rates, as there was limited activity in this segment of the market.