Governor of the Bank of Ghana (BoG) Dr Ernest Addison has said that the central bank is targeting to bring down inflation to a single digit, 8 per cent.
This is a target over the next four to five years, Dr Addison said at the 110th Monetary Policy Committee (MPC) press conference in Accra on Monday, January 30.
Ghana’s inflation rate stands at 54.1% as of December last year.
He said “we try as much as possible to take policy decisions that will help bring inflation down. In that context, the direction of inflation is not only going to be determined by policy rate but a whole lot of other factors including the macroeconomic framework which we have described.
“If you look at the time frame we are looking at three to four years time frame, that is what the IMF programme is designed to do. Within that time we expect to bring down to the Bank of Ghana single-digit target, plus or minute 2 percent, around the central point of 8 percent. This is really the objective of Monetary Policy over the next four to five years.”
He also announced that the Monetary Policy Committee (MPC) has increased the policy rate to 28 percent.
This is up from the earlier rate of 27%.
The upward adjustment reflects the increasing rate of inflation which hit a record high of 54.1% in December last year.
“In the interim, the MPC sees the need to remain vigilant and moderate liquidity in the system to underpin macroeconomic adjustments taking place to drive inflation on a downward path.
“Under the circumstances, the Committee decided to increase the policy rate by 100 basis points to 28%”, the MPC chaired by the Governor of the Bank of Ghana, Dr. Ernest Addison revealed.
By Laud Nartey|3news.com|Ghana