The Bank of Ghana’s Monetary Policy Committee (MPC) increased the policy rate by 100 basis points to 28% by a majority decision.
To improve monetary policy transmission and fortify liquidity management, the Bank is taking supplementary actions in addition to the policy rate change.
The Bank of Ghana’s governor, Dr. Johnson Asiama, said that the bank would add a 273-day device to its current sterilization toolbox.
During Friday’s press briefing for the 123rd MPC in Accra, the governor said.
He added that in order to guarantee compliance, the Bank would also step up its oversight of banks’ Net Open Positions and examine the current Cash Reserve Ratio (CRR) structure to determine its wider effects on liquidity and financial intermediation in the economy.
He said the Committee would examine the possibility of a gradual softening of the monetary stance as inflation solidifies.
According to him, the Committee observed that the uncertain trade and economic policies had made the world environment more difficult.
According to him, the U.S. administration’s ongoing tariff announcements were changing and may potentially harm the world economy.
He warned that if these global challenges continue, they may affect the local economy through trade and finance, underscoring the necessity of proactive policies.
On the home front, he noted, preliminary signs suggest better growth prospects.
The Governor said that the Bank’s CIEA recovered and that the Ghana Purchasing Managers’ Index surpassed the 50-point threshold in February, suggesting that businesses were placing more orders.
“Both business and consumer confidence have improved, and private sector credit growth was recovering and these developments suggest a positive outlook for the economy,” he said.
Source: newsthemegh.com