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Ghana Monetary Policy March 2021

Ghana: Central Bank holds rates for sixth consecutive meeting in March

At its 17–19 March meeting, the Monetary Policy Committee of the Bank of Ghana decided to keep the policy rate steady at 14.50%, marking the sixth consecutive hold.

The decision reflected the Bank’s assessment that although inflation has accelerated recently, it should return to target in the second quarter of this year: Inflation rose to 10.3% in February (January: 9.9%), thus climbing slightly above the Bank’s target range of 6.0%–10.0%. Even though short-term risks to inflation also stem from rising oil prices and revenue-enhancing measures in the 2021 budget, they remain broadly balanced according to the Bank. As such, this allowed the Bank to maintain its accommodative stance, although it signaled the need to remain vigilant regarding risks to the inflationary outlook.

The Bank struck a relatively upbeat tone in the accompanying press release, noting that improved external demand from advanced economies and the rollout of the vaccination program domestically will have a positive effect on the economic outlook in the near term.

The next meeting is scheduled for 19–21 May, with the decision to be announced on 24 May.

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