Policy rate drops further to 22.5%

The Monetary Policy Committee of the Bank of Ghana has reduced the monetary policy rate from the previous 23.5 per cent to 22.5 per cent.

The rate has, therefore, been reduced by 100 basis points. This was announced on Monday, May 22 after the Committee’s 76th policy sitting.

The new figure is a further drop of the rate as it reduced from 25.5 per cent to 23.5 per cent in March, under the Committee’s chairmanship of Dr Abdul Nashiru Issahaku.

The rate was reduced, according to Central Bank Governor Dr Ernest Addison, because government is still on the path of fiscal discipline.

One reason, according to reports, adduced by the Committee for the reduction of the rate is the low levels of risk factors in doing business in the country currently.

Grace Asare also quoted the Chairman of the Committee as saying the the new rate was reached due to measures to cut excessive spending.

The Committee began its meeting on Friday, May 19. The policy rate measures the rate at which the Central Bank lends to commercial banks.