BoG to increase prime rate by 200bps or 300bps
The Central Bank will today, Monday, November 28, announce a new policy rate.
The announcement of the new prime rate follows a review of recent developments in the Ghanaian economy.
Given the recent 320bps rise in headline inflation for the month of October (40.4%), it is anticipated that the Central Bank will also raise the policy rate by 200bps or 300bps to rein in inflation.
Increment in the policy rate will however, lead to increment in cost of loans from banks and other financial institutions.
Increased cost of loans imply increased cost of production and inadvertently increased cost of goods and services.
Currently, the Central Bank’s policy rate stands at 24.5%.
A 200bps or 300bps increment is likely to result in a new policy rate of 26.5% or 27.5%.
