BoG reduces policy rate to 20%

The Bank of Ghana (BoG) has reduced the policy rate by 100 basis points from 21 percent to 20 percent.

This was announced after the Monetary Policy Committee (MPC) finished its 79th meeting which is the final for 2017.

This is the fourth reduction for this year by the Central Bank.

By this, the policy rate has been reduced from 25.5 percent to 20 percent this year.

Speaking at a press conference, the Governor of the Bank of Ghana, Dr. Ernest Addison attributed the reason for the reduction to the inflationary trends and medium targets of the fiscal policy.

“There are indications that the oil induced growth is gaining momentum while the slower non-oil growth remains a concern and may require additional impetus to boost overall growth towards its full potential.”

“However, recent developments such as the implementation of growth enhancing government policy initiatives, positive sentiments from businesses and consumers as well as improvement in electricity supply are supportive of non oil growth.”

The Governor added, “These notwithstanding, slower private credit expansion and tightening credit stance on enterprises could tamper with growth momentum. Under the circumstances, the committee decided to reduce the policy rate by 100 basis points to 20 percent.”