The Bank of Ghana at its Monetary Policy Committee meeting held from Monday has cut the policy rate by 250 basis points to 15.5%. During a press briefing on Wednesday marking the end of the 3-day MPC meeting, Governor of the Bank of Ghana and MPC Chair, Dr. Johnson Asiama, noted that significant improvement in Ghana’s macroeconomic conditions buoyed by tight monetary policy stance, fiscal consolidation, and built-up reserves contributed to the decision to lower the Monetary Policy Rate further at its first meeting of the year 2026. The current rate is a further cut from 18% announced by BOG in November 2025. The central bank is bullish of a strong GDP growth this year with the output gap narrowing which may introduce moderate demand-side pressures so far as current monetary conditions remain tight relative to prevailing inflation dynamics, it observed.

The MPC took a majority decision based on the present economic outlook where overall fiscal deficit on commitment basis stood at 0.5% of GDP, significantly below the 3.5% target. Primary balance on commitment basis recorded a surplus of 2.8% of GDP while public debt declined to 45.5% of GDP as at end-November 2025 from 63.1% recorded a year earlier. In the external sector, Ghana ended 2025 with a current account surplus of $9.1 billion, an increase from $1.5 billion in 2024, driven by strong gold export earnings, increased remittances of citizens abroad, and moderation in the services and income payments. As a result, the country recorded a balance of payment surplus of $3.98 billion, according to provisional figures, with Gross International Reserves reaching 5.7 months of import cover owing in part to the Bank’s decision to liquidate about 18.5 tonnes of gold to cushion the local currency against market disruptions in the foreseeable future.

Improved reserve accumulation provided buffers for the local currency. The cedi
strengthened against the major trading currencies in 2025 and has remained relatively
stable in the first few weeks of 2026. The currency’s strong performance reflected
favourable global conditions, prudent monetary policy, effective liquidity management, and significant reserve buildup. In 2025, the cedi recorded an appreciation of 40.7
percent against the US dollar, compared with a depreciation of 19.2 percent in 2024.

Monetary Policy Committee at its 128th Regular Meeting

Meanwhile in the local banking sector, the central bank noted a strong performance last year driven by growth in domestic deposit, domestic borrowings and shareholders’ funds which reflected in commercial banks reporting an increase in their total assets following increased investments across board. Non-Performing Loans on the other hand though remains elevated saw a reduction from 21.8% in 2024 to 18.9% in December 2025, with BOG confident the easing of the policy rate to further reduce NPLs amidst ongoing policy measures aimed at resolving legacy loans, enforcing strict credit underwriting standards and addressing willful defaults to improve asset quality.

The MPC indicated it will continue to monitor developments closely and take actions ahead of its next meeting in March this year.