The Bank of Ghana has revised its end-of-year inflation target to 12% as it steps up efforts to restore macroeconomic stability.
Governor Dr. Johnson Asiama said the move reflects confidence in ongoing fiscal consolidation and tighter monetary policy, which are beginning to yield results. Ghana’s inflation fell to 22.4% in March from 23.8% in December.
“To bring inflation down sustainably, we have tightened the policy stance,” Dr. Asiama told financial leaders at a post-policy meeting. The central bank raised its benchmark interest rate by 100 basis points to 28% in March — the first such increase since July 2023.
Despite signs of progress, inflation expectations remain high, and core inflation continues to exceed the central bank’s medium-term target. The Monetary Policy Committee was split on the rate hike, with two members preferring to maintain the rate at 27%.
In parallel, Finance Minister Dr. Cassiel Ato Forson has announced aggressive spending cuts to complement monetary measures. The combined strategy, officials say, should reduce inflation to 11.9% by December.
The central bank has also pledged to avoid direct financing of the government and maintain exchange rate stability.
The next Monetary Policy Committee meeting is scheduled for 22 May.
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