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Ghana central bank holds key rate at 14.5%

(The Southern African Times) – Ghana’s central bank on Monday kept its main interest rate unchanged at 14.5%, Governor Ernest Addison said in a statement.

The bank said that although inflation had been on a steady decline in the early months of the fourth quarter of 2020, it rose to 10.4 percent outside its target range of 8%, plus or minus 2 percentage points.

“However, the Bank projects headline inflation to return to target in the second quarter of 2021. Risks to inflation in the near-term are broadly contained,” Addison said.

“Under the circumstances, and given the balance of risks to inflation and growth, the (Monetary Policy) Committee decided to keep the policy rate at 14.5 percent,” he said.

Addison said the global resurgence in coronavirus infections had increased uncertainty in the outlook, posing significant risks to the pace of recovery in the near-term.

He added that the prospects of a sharp fiscal correction in Ghana in 2021 look unlikely amid the second wave of the pandemic which will require additional spending to provide testing and vaccines.

Ghana President Nana Akufo-Addo on Sunday introduced new measures to curb the spread of the disease which has infected over 63,000 people and caused 416 deaths in the West African nation.

Akufo-Addo said Ghana will procure 17.6 million doses of COVID-19 vaccine by the end of June with the first doses arriving in March.

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