The Monetary Policy Committee of Bank of Ghana has kept its key lending rate unchanged at 14.5%

The Committee left the rate at which it lends to commercial banks same for the second time this year.

Speaking at a News Conference, Governor of the Central Bank, Dr. Ernest Addison, said the move was influenced by some threats to inflation and economic growth.

The unchanged policy rate means at least for the next three months, cost of credit will remain virtually same.

The banks will however consider certain factors [loan loss provisioning, inflation, Treasury bills rate etc.] in pricing their loans.

Lending rate drops marginally

Meanwhile, lending rates have declined marginally by 1.69% between January 2020 and July 2020.

Cost of credit stood at 23.69% in January 2020 but has since taken a nose dive to 21.37%.

Total loans and advances has also dropped between January and July 2020.

In January 2020, total loans stood at GHS46.5 billion whilst it was estimated at GHS45 billion in August 2020. It has however hovered around GHS44.9 billion.

This comes despite the BoG announcing measures to encourage banks to advance loans to the private sector especially, amid covid-19.