International ratings firm Fitch Solutions says it expects the Bank of Ghana (BoG) to cut its policy rate by another 100 basis points at its next Monetary Policy Committee (MPC) meeting in September, citing the sustained decline in inflation and the appreciation of the cedi.

Ghana’s inflation slowed to 12.1% in July 2025, down from 13.7% in June, the lowest level since 2021, and is projected to fall further to between 10% and 12% in August.

Over the past months, the cedi has appreciated by about 40% against the US dollar, helping to reduce imported price pressures in a country heavily dependent on imports such as rice, petrol, and vehicles. Weaker global oil prices have also played a role, with Brent crude down roughly 17% year-on-year.

“We expect that the BoG will cut the policy rate by 100 bps to 24.00% at its next MPC meeting in September. Inflation has already eased to 13.7% y-o-y in June, the lowest since 2021, and we anticipate a further decline in the coming months, supported by a stronger exchange rate. Indeed, the cedi is approximately 40% stronger against the US dollar than a year ago, which will continue to curb imported price pressures, particularly given Ghana’s heavy reliance on imported goods such as rice, petrol, and vehicles,” Fitch stated.

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The agency also noted that lower Brent crude prices are further reducing upward pressure on inflation. Fitch projects inflation to settle between 10% and 12% in August, giving the BoG room to proceed with another rate cut.

Meanwhile, Bank of Ghana Governor Dr Johnson Asiama has justified the possibility of a further policy rate reduction, stating that the MPC is monitoring the current inflationary trend and macroeconomic indicators ahead of its September meeting.

The expected cut would follow July’s 300-basis-point reduction to 25%, which the central bank attributed to stronger macroeconomic indicators, anchored inflation expectations, improved foreign reserves, and rising investor confidence.

Looking ahead, Fitch anticipates that the BoG will cut rates by another 100 basis points in November, continuing the easing cycle into the first half of 2026.

“As gold prices remain elevated amid global trade uncertainty and geopolitical risks, the cedi will remain stable over the coming quarters, which will continue to limit imported price pressures. Indeed, we forecast average inflation to moderate from 22.9% in 2024 to 15.5% in 2025 and 12.2% in 2026, allowing the BoG to maintain a dovish stance at the final MPC meeting of 2025 and the first three meetings of 2026,” Fitch added.

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