The Bank of Ghana (BoG) has announced a significant improvement in lending conditions, with the average bank lending rate dropping from 27% to 15.6%, while credit to the private sector increased by 41.2%.
The Governor of the Bank of Ghana, Dr Johnson Pandit Asiama, disclosed these developments when he appeared before Parliament’s Committee on Economy and Development on Friday, November 6, 2026. His appearance focused on monetary policy decisions and Ghana’s macroeconomic performance during the first half of 2026.
According to Dr Asiama, the reduction in lending rates and growth in private sector credit reflect improving economic conditions, supported by stronger economic growth, declining inflation and an improved external position.
Bank of Ghana Reduces Policy Rate to 14%
Providing an update on monetary policy, the BoG Governor explained that the Monetary Policy Committee (MPC) reduced the policy rate from 18% to 14% through decisions taken in January and March 2026.
The committee subsequently maintained the benchmark interest rate at 14% during its May, July and September meetings.
Dr Asiama said the decision to keep the policy rate unchanged was aimed at sustaining economic stability while managing potential inflationary pressures arising from increasing global oil prices and domestic economic conditions.
Ghana’s Economic Growth Reaches 6.4%
The Governor further revealed that Ghana’s real Gross Domestic Product (GDP) expanded by 6.4% in the first quarter of 2026, demonstrating continued economic growth.
On inflation, he indicated that the country’s inflation rate declined to 3.2% in March before rising slightly to 5.3% in June 2026.
Despite the increase, inflation remained below the Bank of Ghana’s medium-term target range of 6% to 10%, reflecting improvements in the country’s price stability conditions.
Ghana Records US$8.81 Billion Trade Surplus
Ghana’s external sector also recorded strong performance during the period under review.
Dr Asiama disclosed that the country achieved a trade surplus of US$8.81 billion and a current account surplus of US$5.1 billion.
Additionally, Ghana’s gross international reserves increased to US$12.94 billion, providing approximately five months of import cover.
He explained that the improved external position demonstrates the country’s strengthened capacity to meet international payment obligations while building financial buffers against potential external economic shocks.
Banking Sector Assets Increase to GH¢502.4 Billion
The Governor also reported significant growth in Ghana’s banking industry, with total banking sector assets rising by 30.7% to GH¢502.4 billion.
The industry’s Capital Adequacy Ratio (CAR) stood at 20.4%, indicating a strong capital position across the banking sector.
Meanwhile, the non-performing loans (NPL) ratio declined from 23.1% to 16.1%, suggesting an improvement in loan portfolio quality and credit risk management.
The reduction in non-performing loans is expected to strengthen the financial stability of banks and improve their capacity to support businesses and households through increased lending.
BoG Introduces Reforms to Strengthen Economic Stability
Dr Asiama outlined several monetary and institutional reforms being implemented by the central bank to improve monetary policy management, strengthen foreign exchange operations and protect Ghana’s external reserves.
Among the measures is the introduction of a uniform Cash Reserve Ratio (CRR) of 20%, alongside a transparent and rules-based framework for foreign exchange market interventions.
He also highlighted the Ghana Accelerated National Reserve Accumulation Programme (GANRAP), which seeks to increase Ghana’s import cover to 15 months by 2028.
The programme is designed to strengthen the country’s international reserves, improve foreign exchange stability and provide greater protection against global economic uncertainties.
Bank of Ghana Reaffirms Commitment to Price Stability
The BoG Governor reaffirmed the central bank’s commitment to maintaining price stability, promoting transparency in monetary policy decisions and strengthening accountability to Parliament and the Ghanaian public.
He noted that the ongoing policy measures are intended to consolidate Ghana’s macroeconomic gains, improve financial sector stability and create a more favourable environment for private sector investment, business expansion and sustainable economic growth.
The latest figures point to improving credit conditions, stronger banking sector performance and an enhanced external position, as the Bank of Ghana continues efforts to support economic recovery and long-term financial stability.
Source: newsthemegh.com