Ghana cuts benchmark rate as inflation slows and Cedi gains

A woman holds 03 July 2007 in Accra a wad new currency, the new cedi, that Ghana put in circulation that day, although the old money will still be valid until the end of the year. Currently, the cedi is one of the least valued currencies in Africa: 9000 cedis equal one US dollar. Ernest Addison, head of research at the Bank of Ghana, assured in November 2006 that the changeover was not a revaluation nor devaluation, and will not affect foreign exchange. AFP PHOTO / ISSOUF SANOGO (Photo credit should read ISSOUF SANOGO/AFP/Getty Images)

 

Bloomberg

Ghana’s central bank cut its benchmark interest rate for a second time in four months as the cedi recovered from record lows and inflation slowed to the lowest rate in more than three years.
The Bank of Ghana cut the rate to 23.5 percent from 25.5 percent, Governor Abdul Nashiru Issahaku told reporters on Monday in the capital, Accra. Four of the seven economists in a Bloomberg survey forecast the rate would be reduced while the remaining respondents said it would be kept unchanged.
Slower inflation and economic growth that’s below its potential gives “scope for further easing,”
he said.
The central bank reduced its key rate in November for the first time since May 2011 even as inflation remained outside the central bank’s target band of 6 percent to 10 percent since at least January 2013. The cedi has recovered from record lows reached earlier this month and gained 8.3 percent since the beginning of March after Finance Minister Ken Ofori-Atta announced plans to cut the fiscal deficit, which was 8.7 percent of gross domestic product in 2016.
Inflation slowed for the fifth consecutive month in February to 13.2 percent, the lowest since November 2013.

Leave a Reply

Send this to a friend