BoG Signals Monetary Policy Rate Reduction with Decreased Interest Rate on Own Bills
The Central Bank is likely to lower its benchmark policy rate at the upcoming 125th Monetary Policy Committee (MPC) meeting scheduled from July 28 to July 30, 2025, as signals from the central bank’s recent short-term bill auctions point to a more accommodative monetary stance.
In its latest auction of BoG bills held on Wednesday, July 9, 2025, the Central Bank raised approximately GHS 155 million at an interest rate of 23%, marking a significant drop from previous auctions. Some days prior, on July 7, the BoG secured GHS 825 million with an interest rate of 26.5%.
Just a week earlier, on July 2, the Bank raised GHS 250 million at a higher rate of 27.9%.
The steady decline in interest rates on the BoG’s short-term instruments is seen by market analysts as a precursor to a possible reduction in the policy rate, as the BoG bill instruments often serve as a key indicator or a reflection of the Bank’s monetary policy direction.
The anticipated policy rate cut is underpinned by the sustained disinflationary trend in the domestic economy. Ghana’s headline inflation eased further to 13.7% in July 2025, representing a 470 basis points decline from the July 2024 rate of 18.4%. The consistent moderation in inflation strengthens the case for monetary policy easing to support economic growth.
Investors, businesses, and consumers alike will closely watch the forthcoming MPC decision, as a cut in the policy rate could lower borrowing costs and stimulate economic activity in the second half of the year.
The Central Bank’s monetary policy rate currently stands at 28%.
