Ahead of the announcement of a policy rate on Monday September 25, 2023, GCB Capital expects the Monetary Policy Committee [MPC] of the Bank of Ghana to maintain the policy rate at 30% for the rest 2023.

It however believes the policy stance will subside in first quarter of 2024 once inflation eases sufficiently.

In its weekly report, it said inflation will decline in quarter 2023.

“Separately, the CPI [Consumer Price Index] data published last week shows headline inflation eased by 3% in August 2023 ahead of the MPC meeting starting at midweek. Despite the simmering upside risks from petroleum prices, we expect inflation to decline through Q4 [quarter 4, 2023], thanks to the anticipated favourable base drift effects.”

The MPC begun its quarterly meeting on September 18, 2023. Top on the agenda is the stabilization of the cedi and anchoring of inflation.

The Committee will also 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.

Inflation falls to 40.1%

The year-on-year inflation for the month of August 2023 fell to 40.1% from the 43.1% recorded in July 2023, the lowest in 12 months.

According to data from the Ghana Statistical Service, Food inflation witnessed a decrease to 51.9% in August 2023, from the 55.0% the previous month.

Non-Food Inflation also dropped by 2.9% to 30.9% in August 2023.