Ghana’s central bank maintains policy rate at 17%

The Central Bank of Ghana says it is maintaining its interest rate of
17 per cent due to the possible impact of inflation pressure on
emerging economies.

The governor of the bank, Ernest Addison, told journalists in Accra
it was also cautious of any spillover effect from a potential trade war
between the U.S and China.

Mr Addison said annualised inflation rose for a second time in a row
to 10 per cent in June, while the local cedi currency, which had been
fairly stable in the first quarter depreciated around six per cent in
the last two months.

“Global conditions are characterised by geopolitical tensions and uncertainties in the external environment.

“There are also concerns about further tightening of U.S. Monetary
Policy with adverse implications on capital flows and currency markets
for emerging market and frontier economies.

“Given the circumstances, especially with regards to the global
outlook, the committee decided to maintain the monetary policy rate at
17 per cent, while closely monitoring developments in the near-term,’’
he said.

Monday’s rate was expected and it would “calm the markets,’’ banking analyst Otuo Acheampong told Reuters.

The major commodity exporter’s public debt amounted to 34.9 billion
dollars, representing 63.8 per cent of Gross Domestic Product (GDP) at
the end of May.

The country’s net international reserves stood at 4.15 billion
dollars at the end of June, representing 2.2 months of import cover.