After enjoying consistent cuts in policy rate, there is more hope for the business community for a lower lending rate, as IC Research has predicted another cut in the benchmark rate.
These relatively low inflation levels are coming after years of soaring prices, resulting in a tight monetary policy. This raised the policy rate and, hence, a high lending rate for businesses. But 2025 has seen a fresh breeze of cooling inflation sweeping through Ghana’s economy.
IC Research says inflation has finally fallen back into the Bank of Ghana’s medium-term target band for the first time since 2021, and the monetary policy committee has responded with policy rate cuts.
But that is not all. The research institute says there is a strong expectation that the central bank could cut its policy rate in November 2025, a move that would signal the start of lower lending rates and brighter days for businesses.
According to IC Research, headline inflation dropped sharply to 9.4% year-on-year in September, falling faster than expected and marking the country’s first single-digit inflation in over four years. The report describes this milestone as “a decisive progression towards price stability,” which is a crucial foundation for reducing the cost of borrowing and restoring business confidence.
The fall in inflation, IC Research maintains, was broad-based. Goods inflation, which dominates over 70% of the consumer basket, dropped by 2.7 percentage points to 11.2%, while services inflation eased to 4.8%.
These trends suggest that prices of both everyday goods and services, from food to transportation and rent, are finally cooling after a long stretch of persistent hikes.
“In our view, this reflects recent foreign exchange shift to the upside and the resultant upticks in domestic energy prices. We view the first single-digit headline inflation in September 2025 as a confirmation that the Ghanaian economy has progressed decisively towards price stability after over four years of double-digit price increases”, IC Research explained.
“While upside risk to the near- and medium-term path looms, we believe the authorities would be minded by the need to lock in the gains with continued policy credibility. The durable moderation in inflation risk has further strengthened the case for another cut in the nominal policy rate with downside scope for domestic bond yields in 4Q2025 [4th quarter of 2025]”, it predicted.
This prediction, if it truly manifests in the next MPC meeting, could mean a reduction in commercial lending rates, which have been hovering around the 30% mark, choking business activity, especially for small and medium-sized enterprises (SMEs).
For manufacturers and traders, lower interest rates would mean cheaper loans to expand production, restock inventory, or hire more workers. For households, it could reduce the cost of personal and mortgage loans, freeing up income for spending.
If the Monetary Policy Committee cuts the policy rate next month as predicted, it could mark the beginning of a new cycle, one where businesses breathe easier, consumers spend with confidence, and the economy gradually picks up pace again.
