Ghana’s central bank Wednesday cut its benchmark interest rate by three percent on the back of easing inflationary pressures, as the west African country emerges from a severe economic crisis.
The Bank of Ghana announced that its benchmark rate would drop from 28 percent to 25 percent — the first such reduction in more than a year, which comes as the cedi currency has recovered against the dollar.
“We remain committed to our price stability mandate while creating the conditions for sustainable growth,” said the bank’s governor Johnson Pandit Asiama.
While prices are still rising in the major cocoa and gold producer, inflation eased in June to 13.7 percent year-on-year — the sixth consecutive monthly drop.
At the same time, the cedi has appreciated by more than 40 percent against the US dollar since the start of 2025, supported by stronger external buffers, rising exports and growing investor confidence.
The International Monetary Fund earlier this month said Ghana was making headway in its economic reforms and debt restructuring that the government has embarked on since President John Mahama, swept into office amid economic turmoil, was sworn in in January.
Food inflation has also eased, but remained above overall inflation in July, at 16.3 percent.
Despite the progress, many ordinary Ghanaians have come under hardship as the cost of living has continued to rise.
According to a “Jollof Index” from SBM Intelligence, a Lagos-based consultancy, the cost of preparing a pot of jollof rice — a west African staple of rice, vegetables and meat — has risen from 278 cedis in January 2023 to 420 cedis ($26 to $40) as of June 2025, though prices have recently stabilised.
“Households have seen marginal increases in disposable incomes due to reduced fuel and transport costs, unlike in 2023 and 2024”, SBM’s most recent report noted.
AFP
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