The MP for Kwadaso, Dr. Kingsley Nyarko, has explained that the increment in interest rate is part of government’s efforts to curb the persistent hike in inflation.

According to him, “We brought interest rate to as low as 12.5 per cent. You know why interest rates increase? It is a response to dealing with inflation. That is why it is around 23 per cent now.”

Speaking on JoyNews’ AM Show, on Wednesday, the lawmaker indicated that the Bank of Ghana may review their interest rate but commercial banks would also project their figures based on fears that borrowers may default.

According to him, the country needs to enhance its revenue “envelope” in order to cater for the “social goods and services” that the people demand.

In recent times, Ghana’s interest and inflation rates have been on the rise.

The country’s fiscal situation is said to have dwindled to a great extent, the confidence of investors.

Latest statistics indicate that the Bank of Ghana raised its monetary policy rate to 24.4 per cent in October.

Interest rate is projected to reach 26.50 per cent by the end of the last quarter.

According to predictions, Ghana’s interest rate is set to reach about 28.50 per cent in 2023 and then reduce to 27.00 per cent in 2024.

However, the government has promised to put in measures to revive the persistent fiscal problems pending a budget reading on Thursday.