Ghana’s macroeconomic landscape continuous to experience some transformation as the new year begins, with record-low inflation figures providing the Bank of Ghana (BoG) ample room to further slash borrowing costs. Following a historic decline in consumer prices, the central bank is widely expected to reduce its Monetary Policy Rate (MPR) from the current 18% when the Monetary Policy Committee (MPC) meets later this month.
The latest data from the Ghana Statistical Service (GSS) reveals that annual inflation slowed to 5.4% in December 2025, down from 6.3% in November. According to Government Statistician Alhassan Iddrisu, this figure represents the lowest level since the 2021 rebasing of the Consumer Price Index. Analysts suggest that without the rebasing, the headline figure would have marked a 23-year low. This disinflation process was heavily supported by a 41% appreciation of the cedi against the dollar in 2025—the currency’s first annual gain in over three decades. This surge, fueled by a rally in gold prices and strengthened external buffers, significantly reduced the cost of imported goods and local production inputs.
Parallel to the cooling prices, the Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has restated a bold ambition to reshape Ghana’s credit environment. Speaking during a high-profile visit from the Asantehene, Otumfuo Osei Tutu II, Dr. Asiama disclosed a policy target to reduce commercial lending rates to no more than 10% by 2028. Currently, market conditions are already softening; average lending rates have dipped from 26.6% to 24.2%, while the 91-day Treasury bill rate fell to 10.3% in late 2025. With gross international reserves hitting a record $13.8 billion, the Governor emphasized that the central bank is now focused on expanding access to affordable credit to support growth.
A fourth consecutive rate cut on January 28, potentially by more than 200 basis points would signal a definitive shift from “tight” to “accommodative” monetary policy. For the Ghanaian business community, the implications are profound. Lower interest rates make previously unviable capital projects attractive, particularly in the manufacturing and construction sectors, while reduced costs for personal loans and mortgages are expected to boost household consumption. Furthermore, the Bank’s strong reserve position suggests that the easing cycle can continue without triggering a currency sell-off, providing a stable horizon for long-term planning.
As the BoG prepares for its first meeting of 2026, the convergence of single-digit inflation and record reserves has created a “perfect storm” for economic expansion. If the Governor’s 10% target is achieved by 2028, Ghana could see its most competitive business environment in nearly half a century.
