- Policy Rate Held at 28%: The Monetary Policy Committee maintained the policy rate at 28.0%, citing the need to sustain disinflation despite recent macroeconomic improvements.
- Inflation Drops to 21.2%: Headline inflation fell by 2.6 percentage points to 21.2% in April 2025, supported by tight monetary policy, fuel price cuts, and a stable cedi.
- Cedi Makes Strong Gains: The Ghanaian cedi appreciated 24.1% against the US dollar, 16.2% against the pound, and 14.1% against the euro year-to-date.
- Economic Activity is Rising: The Composite Index of Economic Activity rose by 2.3% year-on-year in March 2025, indicating improved private sector activity and construction output.
- Record Current Account Surplus: Ghana recorded a US$2.1 billion current account surplus in Q1 2025, largely due to strong gold, cocoa exports, and remittance inflows.
- Reserves Hit US$10.7 Billion: Gross International Reserves reached US$10.7 billion, covering 4.7 months of imports, a strong buffer for the economy.
- Public Debt Now 55% of GDP: Ghana’s total public debt stood at GH¢769.4 billion, or 55.0% of GDP at end-March 2025, down from 61.8% in December 2024.
- New FX Reserve Rule Announced: Effective June 5, 2025, banks must hold reserve requirements in the same currency as deposits, foreign currency for FX, cedis for local deposits.
- Inflation Target Moved Forward: Inflation is now projected to reach the medium-term target by Q1 2026, earlier than the previous estimate of Q2.
- Next Policy Meeting: July 21–25, 2025: The next MPC meeting will take place from July 21 to 25, 2025, with the new policy decision to be announced at the end of that week.
So what?
The Bank of Ghana’s latest decision reflects a cautiously optimistic outlook. While inflation and debt are trending down and the cedi shows renewed strength, the central bank remains firmly committed to a tight monetary stance to consolidate gains.
