The Bank of Ghana has announced an Emergency Monetary Policy Committee meeting from Wednesday, August 17, 2022.

According to a statement, the meeting will review developments in the economy over the past month.

Why this meeting now?

It is still not clear what might be the main reason for this meeting.

According to the Central Bank’s own calendar, the MPC was initially expected to meet next month – September 20th to 23rd, 2022.

However, the possibility of the BoG taking some extra measures on the monetary side to check the rising inflation rate, could be the reason.

Others are also looking forward to some Foreign Currency Measures to check the cedi’s sharp depreciation.

But a source close to the Central Bank maintained that previous examples have shown it’s never prudent to take emergency Foreign Exchange measures when the Ghana cedi is depreciating, adding, that “a similar measure taken in 2014 did not work.”

This, the source added, could send negative signals to the market.

The Bank of Ghana in a previous statement had assured the public that it is taking measures to stabilise the cedi and therefore advised businesses not to panic.

Monetary Policy Rate decision in July 2022

The Bank of Ghana at its last meeting in July 2022 left the rate unchanged at 19%, citing “deceleration” of the rate of inflation and concerns over economic growth.

The Bank of Ghana, has since the end of 2021 increased the Policy Rate by some 550 basis points to try and contain the rising inflation rate.

The Governor, Dr. Ernest Addison, during the MPC press conference indicated that the Central Bank was pausing to observe the impact on inflationary pressures of recent rate hikes and other policies, “noting that the bank had observed that inflation had persisted and broadened to almost all items in the consumer basket”.

The government at the last meeting also maintained that “the committee was of the view that it was appropriate to pause and observe the impact of the recent monetary measures already taken.”