The Bank of Ghana has reduced its policy rate from 15.5 percent to 14 percent, representing a 150 basis point cut as part of efforts to support economic recovery.

According to Central Bank Governor, Dr Johnson Pandit Asiama, the decision forms part of a continued shift toward easing monetary conditions following a period of tight policy aimed at controlling inflation.

The policy rate serves as a benchmark for interest rates across the economy, and the reduction is expected to translate into lower borrowing costs for businesses and households. Commercial banks may also gradually adjust their lending rates downward, making it cheaper to access credit.

LIVESTREAMED: Bank of Ghana holds 129th MPC press briefing

For businesses, particularly small and medium-sized enterprises, the rate cut could provide relief by reducing the cost of financing operations and expansion. This may also encourage investment, boost productivity, and support job creation.

For households, the move could ease the burden of loan repayments over time, especially for those with variable-rate loans. Lower interest rates may also improve access to credit for housing, education, and other personal needs.

Explaining the decision at the 129th MPC press briefing on March 18, 2026, the BoG Governor noted “continued improvements in domestic macroeconomic conditions during the first two months of the year,” although he warned that “rising geopolitical tensions in the Middle East have deepened uncertainty in the external sector.”

He added that the Monetary Policy Committee (MPC) indicated its latest forecast suggests that “headline inflation will remain within the medium-term target,” but cautioned that “upside risks to the inflation outlook include the likely pass-through of higher crude oil prices and escalating geopolitical tensions.”

Despite these risks, the MPC maintained that “the favourable domestic macroeconomic conditions and high prevailing real interest rates provide scope to ease the policy rate further.”

Dr Asiama added that the central bank will continue to closely monitor developments in the Middle East and their potential implications for the inflation outlook.

He stressed that the Bank stands ready to take appropriate policy actions as needed to safeguard price stability.

MA