GHANA, JULY 23, 2018 – Ghana’s central bank says it is maintaining its interest rate of 17 per cent due to the possible impact of inflation pressure on emerging economies.
The apex bank Governor, Ernest Addison Addison told reporters in Accra it was also cautious of any spillover effect from a potential trade war between the U.S and China.
Addison said that 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.
