BoG Governor Signals Fiscal Measures to Tackle Food Inflation in 2025 Budget
The Governor of the Bank of Ghana, Dr. Johnson Asiama, has indicated that the upcoming 2025 budget will introduce targeted measures to address food inflation, which remains a key driver of overall price pressures in the economy.
With rising food costs straining household finances and increasing business expenses, the central bank sees fiscal intervention as critical to stabilizing prices and reinforcing macroeconomic stability.
Speaking to Bloomberg on inflationary trends, Dr. Asiama acknowledged that the latest inflation reading had exceeded expectations, largely due to persistent food price pressures. He emphasized that these pressures were structural and required policy action.
“The last reading came in a little higher, but we think that going forward, if you look at the causes of inflationary pressures, it was mainly from food inflation. It was mainly structural in nature. Therefore, the coming budget statement should introduce a number of measures to contain food inflation. If that is done, I am sure we will see a return to the disinflation path,” he stated.
The government’s fiscal response is expected to complement the Bank of Ghana’s monetary policy efforts, with the central bank maintaining a tight stance to anchor inflation expectations.
Dr. Asiama also revealed that the Bank of Ghana’s Monetary Policy Committee (MPC) is scheduled to meet next month to reassess economic conditions and determine an appropriate policy response.
“We plan to hold the next monetary policy meeting next month, where we will reassess the conditions and take an appropriate decision. Therefore, once we have an appropriate monetary policy stance in place and food price inflation is well controlled, we will begin to see inflation trending back to its target path,” he added.
The central bank’s outlook suggests that achieving price stability will require a coordinated approach, balancing monetary restraint with fiscal measures to tackle underlying supply-side constraints in the food sector.
