The Monetary Policy Committee (MPC) of the Bank of Ghana has standardised the cash reserve requirement for commercial banks at a uniform 20 percent, effective June 4, 2026, as part of efforts to strengthen liquidity management and improve policy transmission in the banking sector.
The decision marks a shift from a more flexible framework to a simplified rule requiring all banks to hold 20 percent of their deposits in domestic currency at the central bank.
Governor of the Bank of Ghana, Dr. Johnson Asiama, said the move was taken alongside a broader review of macroeconomic conditions, which show continued disinflation and improving external stability.
He noted that the MPC maintained the Monetary Policy Rate at 14.0 percent, reflecting a broadly balanced inflation outlook, with headline inflation currently at 3.4 percent.
Dr. Asiama also highlighted improvements in Ghana’s external position, including a current account surplus of US$3.1 billion in Q1 2026, up from US$2.43 billion in Q1 2025, supported by stronger foreign exchange inflows and improved reserve accumulation, which have helped stabilise the cedi.
According to him, these gains, together with fiscal consolidation measures and tight monetary policy, continue to support the disinflation process.
However, he cautioned that risks remain, including global commodity price volatility, external economic uncertainties, and domestic fiscal pressures.
He further stressed that elevated credit risk in parts of the banking sector remains a concern, calling for strict compliance with regulatory guidelines aimed at reducing non-performing loans (NPLs) and strengthening financial stability.
The MPC also noted that recent increases in fuel prices could create short-term inflationary pressures, but said mitigating factors such as exchange rate stability, reserve buffers, and continued fiscal discipline are expected to help contain upside risks.
The central bank said the introduction of a uniform cash reserve requirement is expected to improve consistency in liquidity management across banks and enhance the effectiveness of monetary policy decisions.
The Monetary Policy Rate, which serves as the benchmark for lending costs across the economy, remains unchanged at 14 percent as the central bank seeks to balance price stability with economic recovery.
