The Bank of Ghana is concerned that the inflation rate could rise above 10 percent by the end of this year if crude oil prices continue to increase on the international market.

This was captured in an internal projection model that often guides the monetary policy decisions of the Bank of Ghana, as well as its Inflation Targeting Framework.

The model, under one scenario, noted that if the price of crude oil remains above 100 dollars throughout the month of June, it could present challenges for inflation in the coming months.

If inflation were to inch above 10%, it would breach the Bank of Ghana’s upper bound target band for inflation this year and over the medium term.

JOY BUSINESS is learning that these are among several scenarios developed by the Bank of Ghana to guide its monetary policy decisions and should not be viewed as a major concern for the central bank.

There are also concerns about the impact of rising crude oil prices on petroleum products, the pass-through effect on transport fares, and the quarterly utility tariff review, all of which could add further pressure to inflation in the coming months.

Impact

If this forecast is anything to go by, it could influence members of the Monetary Policy Committee to vote for a policy rate hike or maintain the rate at its current level during their next meeting, scheduled for July 20 to 22, 2026. The meeting will conclude with a policy decision.

Should the Bank of Ghana decide to increase the policy rate, it could have a negative impact on interest rates in the country.

The Ghana Reference Rate for May 2026 stood at 10.03%, and there are concerns that it could rise further in the coming months.

Bank of Ghana Governor Dr. Johnson Asiama, during an engagement with businesses and investors at the Ghana-UK Investment Summit, noted that recent developments in the Middle East may force the Monetary Policy Committee to "pause" policy rate cuts.

He, however, assured stakeholders that if conditions normalize soon, the committee could react quickly and proceed with its rate review.

Some analysts have warned that the biggest threat to Ghana’s economic stability at the moment could be developments in the Middle East if the situation does not improve soon.