Ghana slashes interest rate to 15.50% as inflation falls

By Emmanuel Bruce and Christian Akorlie

ACCRA, Jan 28 (Reuters) - Ghana's central bank slashed its main interest rate GHCBIR=ECI by 250 basis points to 15.50% - the lowest level in four years and below most economists' expectations, in a decision announced on Wednesday, as inflation remains under control.

Economists surveyed by Reuters had expected Bank of Ghana to lower the rate by 200 bps to 16% after a big 300 bps cut in July and record 350 bps cuts in September and in November.

The bank has now brought down its main lending rate by a cumulative 12.5 percentage points since starting its current easing cycle last July.

Bank of Ghana Governor Johnson Asiama told a news conference the majority decision by the bank's Monetary Policy Committee meeting acknowledged that the gold- and cocoa-producing West African nation's macroeconomic conditions had improved significantly.

"This was supported by the tight monetary policy stance, fiscal consolidation and significant build up of reserves," he said, adding that consumer inflation for the first six months of the year was expected to be broadly aligned within the bank's medium-term target range, while growth was expected to remain strong in 2026.

Consumer inflation has fallen sharply from a record rate of 54.1% in December 2022 to 5.4% in December 2025. The Bank of Ghana now targets an inflation rate of 8%, with a tolerance band of 2 percentage points either side.

Asiama said it was still too early for the bank to review its inflation target.

MORE EASING EXPECTED

Capital Economics analyst David Omojomolo said the bank remained dovish as it was keen to support growth against the backdrop of low inflation.

"We remain comfortable with our forecast for at least another 550 basis points of cuts to be delivered over the rest of this year," Omojomolo said.

Ghana is emerging from its most severe economic crisis in decades, and it is expected to complete a three-year IMF support programme in August.