The Monetary Policy Committee (MPC) of the Bank of Ghana will begin its 111th regular meeting from Wednesday March 22, 2023 to Friday, March 24, 2023, to review developments in the economy.
The meeting is coming at a crucial time in which interest rates have been easing drastically, but inflation is still high at about 52.8%.
It is therefore unclear whether the MPC led by the Governor of the Bank of Ghana, Dr. Ernest Addison will cut the Central Bank’s policy rate to help reduce the cost of borrowing.
Again, the meeting is expected to prioritise the expected bailout from the International Monetary Fund to revive the Ghanaian economy.
Finance Minister heads to China to negotiate terms of debt restructuring
The Finance Minister, Ken Ofori Atta, is expected to be in China by March 22, 2023 to begin negotiations on debt restructuring with officials of that country.
The Minister who is leading the government delegation is expected to continue bilateral talks with China as well as seek financial assurances for Ghana’s programme with the International Monetary Fund.
BoG increases policy rate to 28%
The Central Bank in its last meeting in January 2022 adjusted upward the policy rate by 100 basis points to 28% due to downside risks to inflation and exchange rate depreciation.
“In the interim, the MPC [Monetary Policy Committee] sees the need to remain vigilant and moderate liquidity in the system to underpin macroeconomic adjustments taking place to drive inflation on a downward path. Under the circumstances, the Committee decided to increase the policy rate by 100 basis points to 28%”, the MPC chaired by the Governor of the Bank of Ghana, Dr. Ernest Addison revealed.
Already, some experts and institutions are projecting an unchanged policy rate for the next two and half months.
Bloomberg forecasts unchanged policy rate
Meanwhile, Bloomberg is forecasting a steady policy rate for the next two and half months.
It said economists it surveyed expect the Bank of Ghana’s MPC to keep policy rate unchanged at 28%
MPC to review business risk factors
Also, the MPC will review some business risk factors such as consumer and business confidence.
The meeting will conclude with a press conference on Monday, March 26, 2022 to announce the decision of the Committee.
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