Financial Analyst and Banking Consultant, Dr. Richmond Atuahene has questioned the feasibility of the Bank of Ghana’s target to achieve single-digit inflation by 2026.
Dr. Richmond Atuahene is convinced that with the prevailing economic conditions achieving lower levels of inflation is just a mere mirage if not wishful thinking.
The Monetary Policy Committee (MPC) of the Bank of Ghana at the last sitting maintained the policy rate at 27% due to elevated inflationary pressures. The Governor, Dr. Ernest Addison further announced a revision of the bank’s single-digit inflation target.
The bank earlier anticipated achieving single-digit inflation in the first quarter of 2026. However, given current developments, the governor says it’s been forced a revise to the second quarter of 2026. This revision also comes on the heels of a missed inflation target for 2024.
Anticipated to end 2024 with an inflation rate of 15%, the economy crossed to 2025 with a rather higher rate of 23.8%.
But the new target set for the second quarter of 2026, Dr. Atuahene tells The High Street Journal is likely to be missed if drastic measures are not taken to address food inflation.
He questioned the effectiveness of the bank’s inflation-targeting framework in lowering rates. He believes the framework fails to address the supply side of the causes of inflation and hence until food production is prioritized, our target for inflation will continue to be elusive.
Importation of food, he says is a major cause of the depreciation of our currency leading to high inflation levels. This continues to bring distress to businesses and individuals, especially low-income earners since the rising inflation indirectly steals their income by reducing their purchasing power and threatening their standards of living.
The financial analyst cannot understand why with the abundance of resources endowed the country, we can cultivate our own food but heavily rely on importation.
“We can’t cultivate tomatoes. We can’t cultivate onions. We can’t cultivate rice. Whenever we take money to import these, the strength of the cedi weakens and fuels inflation. I heard he [Governor of Bank of Ghana, Dr. Ernest Addison] said we will achieve single digit inflation in the second quarter of 2026, there is no magic wand to achieve that until we are able to cultivate our food,” Dr. Atuahene remarked.
The financial analyst says a consistent food supply which will lead to a reduction in food inflation is achievable if the government wholeheartedly commits to it.
He further calls for value and supply chain problems in the agricultural sector such as preservation, transportation, and extension services among others to be tackled to enhance food production.
Without tackling food production, Dr. Atuahene says it will only take a miracle for the economy to achieve very low levels of inflation which will not be inimical to businesses and Ghanaians.
