The Bank of Ghana has reiterated that inflation would increase in the medium-term into the target band of 8 ± 2%, barring any significant shocks.

According to its July 2026 Monetary Policy Report (MPR), the Central Bank said this will be influenced by the upward revisions in utility tariffs, re-escalation of geopolitical tensions in the Middle East, and the potential impacts of heavy rains on the food supply chain present upside risks to the inflation outlook.

Notwithstanding this, it pointed out that the maintenance of an appropriate monetary policy stance, strong sterilisation efforts, ongoing fiscal consolidation, and adequate reserve buffers are expected to mitigate these risks over the forecast horizon.

At the 131st MPC Meeting, the Committee noted elevated risks in the global environment arising from escalating tensions in the Middle East.

It further acknowledged the strengthening of domestic growth and continued improvements in the trade balance, which would help build reserve buffers and enhance the economy's resilience to heightened global uncertainty.

In taking the monetary policy decision, the MPC noted that the renewed Middle East conflict and associated disruption of trade routes had re-ignited volatility in energy markets. These developments, they highlighted, could disrupt global supply chains and dampen global growth.

In addition, disinflation trends in several countries had stalled as energy prices had risen sharply, prompting many central banks to pause their monetary policy easing cycles in response to emerging inflationary risks.

“Although global financing conditions remained relatively accommodative, the persistence of external shocks could result in tighter conditions, with adverse effects transmitted through the trade and financial channels of emerging market and developing economies”, it mentioned.

The year-on-year inflation rate increased to 5.0% in August 2026, up from 4.6% recorded in July, according to the latest figures from the Ghana Statistical Service (GSS).