Ghana Central Bank Governor Sees Room for Further Rate Cut

ACCRA (Capital Markets in Africa) – Bank of Ghana Governor Ernest Addison said there is scope for a further cut in the country’s main interest rate should the economy keep improving. 

“If the fundamentals of the economy are seen to be improving, then there is room for a rate cut, even though inflation has stayed at around 12 percent,” he said in an interview Tuesday in the capital, Accra.

The central bank of West Africa’s biggest economy after Nigeria’s kept its key lending rate at 21 percent, the lowest since 2015 at its September meeting. It had reduced the measure for three straight meetings until July as consumer prices rose at the slowest pace in four years in that month. The government has vowed to boost growth from last year, when the economy expanded at its slowest rate in more than a quarter of a century.

There are signs of improvement in the economy of Ghana, the world’s biggest cocoa producer after Ivory Coast, with gross domestic product expanding 9 percent in the second quarter, the most in three years, as new oil fields start pumping crude.

Consumer-price growth slowed to 12.2 percent in September. Inflation will trend toward a “medium-term target” of 6 percent to 10 percent in early 2018, “barring any unanticipated shocks,” Addison said on September 25.

Source: Bloomberg Business News