In a rare move, the Bank of Ghana (BoG) is set to hold an Emergency Monetary Policy Committee (MPC) meeting today, Thursday, July 17, 2025, to review recent macroeconomic trends.
This urgent meeting is coming a week ahead of the usual schedule, putting many industry players, economists, and analysts in suspense.
It is also coming at a time when there is a notable sharp decline in inflation to 13.7%, the lowest in over a year.
The urgency of the meeting stems from the need to avoid a potential scheduling conflict with the upcoming Mid-Year Budget Review by the Ministry of Finance, which is expected later this month.
But some analysts believe the decision to convene earlier than usual also underscores the intense pressure mounting on the Bank of Ghana to respond to changing economic realities, particularly from the private sector, which is calling for a policy rate cut to unlock credit and drive growth.
The policy rate stands at a steep 28%, a figure that many argue is no longer justifiable in light of the sharp disinflation recorded over the past year. Businesses, banks, and consumers alike say the high rate is stifling access to affordable capital, slowing economic recovery, and limiting investment appetite.
The Split Opinions
Sources close to the MPC reveal split opinions within the Committee. Some members are inclined to lower the rate in response to improving inflation dynamics and easing domestic pressures.
However, other members on the other side remain cautious, pointing to lingering global risks such as oil price volatility, geopolitical tensions, and currency pressures. The International Monetary Fund (IMF) has also reportedly advised Ghana to maintain a tight monetary stance for now, a factor that could weigh heavily on today’s deliberations.
Implications for the Upcoming Mid-Year Budget
For the fiscal side, the stakes are high, not just for the Central Bank but also for the Ministry of Finance.
The decision from the emergency meeting is expected to be announced tomorrow, Friday, July 18, 2025. A policy rate cut, if announced tomorrow, could signal confidence in the economy’s stability and provide a critical tailwind for the upcoming Mid-Year Budget.
Lower interest rates could ease private sector borrowing costs and offer room for the sector to invest, grow, and expand to propel economic growth at lower costs.
On the flip side, a decision to hold the rate steady or tighten further, as the IMF prefers, might be viewed as prudent but could draw criticism from local businesses already burdened by expensive credit and slow post-pandemic recovery.
What to Expect
Will the Bank of Ghana choose growth over caution? Will the Mid-Year Budget arrive on the back of cheaper credit, or will the status quo remain?
As the new government continues with its reset agenda, any outcome from the emergency meeting today, which will be announced tomorrow, could shape the tone, content, and credibility of the Mid-Year Budget, including the country’s economic trajectory, for the rest of the year.
