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BANK OF GHANA
MONETARY POLICY COMMITTEE
PRESS RELEASE
18 March 2026


The Monetary Policy Committee (MPC) held its 129th regular meetings from 16-18
March 2026 to review recent economic developments and assess risks to the outlook
for inflation and growth. This statement summarises the key discussions and the
Committee's decision on the Monetary Policy Rate.

At the previous meeting in January, global growth was resilient, supported by
accommodative monetary policy stance in advanced economies, stronger consumer
and business confidence, and increased investment spending, especially by
technology firms. However, the global environment has since changed drastically,
largely due to the Middle East conflict.

The conflict has disrupted global supply chains, increased crude oil market volatility,
raised financial stability concerns, and heightened global uncertainty. Although global
headline inflation has been on a downward trajectory, the recent surge in oil prices
has renewed inflation concerns and may compel some central banks to reassess their
monetary policy stance. Consequently, global financing conditions, which remain
broadly accommodative, could tighten in the near term. Depending on the intensity
and duration of the conflict, these developments could weigh on the global economic
outlook.

On the domestic front, provisional data released by the Ghana Statistical Service
indicated that real GDP grew by 6.0 per cent in 2025, compared with 5.8 per cent in
2024. Non-oil GDP growth accelerated to 7.6 per cent from 6.1 per cent over the same
period, largely driven by the services and agriculture sectors.

The Bank’s high frequency real sector indicators pointed to a sustained pickup in
economic activity. The real Composite Index of Economic Activity recorded an annual
growth of 8.4 per cent in January 2026 compared to 6.0 per cent for the corresponding
period of 2025. Increased credit to the private sector by banks, industrial production,
international trade activities, and consumption of goods and services by households
and firms contributed to the improvement in economic activity.

The Bank’s confidence surveys conducted in February 2026, reflected positive
consumer and business sentiments. Consumer confidence improved on account of
easing inflationary pressures and optimism about future economic conditions.
Similarly, business confidence strengthened on the back of realisation of operational
targets and optimism about industry prospects amid improving macroeconomic
conditions.

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Headline inflation declined further to 3.3 per cent in February 2026, from 5.4 per cent
in December 2025, driven by both food and non-food inflation. Core inflation, which
excludes energy and utility items, also declined, indicating muted underlying price
pressures. Additionally, inflation expectations among consumers, businesses and the
financial sector remained broadly anchored. The strong disinflation during the past 14
months has been supported by the relatively tight monetary policy stance, cedi
appreciation, and improved food supply conditions.

Growth in monetary aggregates continued to slow in February 2026, reflecting the
relatively tight monetary policy stance. Reserve money contracted by 0.5 per cent
year-on-year in February, compared to 68.8 per cent growth a year earlier. Also, broad
money supply growth eased to 16.0 per cent, from 33.1 per cent over the same period.

Interest rates on short-term bills declined sharply in the first two months of 2026 on
the back of easing inflation expectations and fiscal restraint. Yield on the benchmark
instrument, the 91-day Treasury bill, declined sharply in February. Also, average bank
lending rates declined to 19.2 per cent in February 2026, from 30.1 per cent same
month last year, leading to a gradual increase in private sector credit.

Provisional data showed that fiscal outturn for the period January to December 2025
was marked by constrained government spending due to commitment control
measures amid shortfalls in revenue. In the review period, the overall fiscal deficit on
commitment basis was 1.0 per cent of GDP, below the budget target deficit of 2.8 per
cent. On commitment basis, the primary balance recorded a surplus of 2.6 per cent of
GDP, exceeding the target of 1.5 per cent. At the end-December 2025, the provisional
public debt stock was equivalent to 45.3 per cent of GDP, down from 61.8 per cent at
the end-December 2024.

The banking sector performance improved in February 2026. Total assets increased
supported by domestic deposits, domestic borrowings, and shareholders’ funds. The
asset growth was mainly driven by investments, which rose by 57.5 per cent,
compared to 8.6 per cent growth in February 2025. The financial soundness indicators
in terms of profitability, liquidity, solvency, asset quality, and efficiency, all improved
over the period. The Non-Performing Loan (NPL) ratio declined to 18.7 per cent in
February 2026 from 22.6 per cent a year earlier, driven by a pickup in bank credit and
a contraction in the NPL stock. Despite improvement in asset quality, the NPL ratio
remains a key risk to the banking sector. Going forward, the Bank has put in place
measures for the full implementation of the regulatory guidelines aimed at reducing
NPLs in the banking industry.

The external sector remained strong at the start of the year. The trade surplus
improved to US$3.7 billion in the first two months, compared with US$2.1 billion during
the same period in 2025, driven by higher gold export earnings and modest import
growth. Gross International Reserves increased to US$14.5 billion (equivalent to 5.8
months of import cover) as at end-February 2026, up from US$13.8 billion (5.7 months
of import cover) at end-December 2025. Reflecting the strong external sector, the cedi
has remained relatively stable. Looking ahead, reserve accumulation is expected to
strengthen further under the Ghana Accelerated National Reserve Accumulation
Programme, which aims to increase the import cover to 15 months by 2028.

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In taking the policy decision, the Committee noted continued improvements in
domestic macroeconomic conditions during the first two months of the year. However,
rising geopolitical tensions in the Middle East have deepened uncertainty in the
external sector.

The Bank’s latest forecast suggested that headline inflation will remain within the
medium-term target. Upside risks to the inflation outlook include the likely passthrough of higher crude oil prices and escalating geopolitical tensions. In the view of
the Committee, despite these upside risks to the inflation profile, the favourable
domestic macroeconomic conditions and high prevailing real interest rates provide
scope to ease the policy rate further.

Consequently, the Committee decided to reduce the monetary policy rate by 150 basis
point to 14.0 per cent.

The Committee will continue to closely monitor developments in the Middle East and
its potential implications on the inflation outlook. The Committee stands ready to take
appropriate policy actions as needed to safeguard price stability.


Informational Note
The next Monetary Policy Committee (MPC) meeting is scheduled for 18-20 May
2026. The meeting will conclude on 20 May 2026, with the announcement of the policy
decision.