By Seraphine Nyuiemedi
The 123rd Monetary Policy Committee (MPC) meeting of the Bank of Ghana (BoG) opened today with a bold call for greater transparency and decisive action in tackling the country’s persistent inflation and economic uncertainties.
Dr. Johnson Asiama, presiding over his first meeting as Governor of the Bank of Ghana, wasted no time in addressing the pressing challenges facing the nation’s economy. With inflation still hovering at a troubling 23% and fiscal deficits exceeding program targets, the stakes were high as the committee gathered to determine the path forward.
“There’s a growing sense in public commentary that MPC decisions are taken behind closed doors without clear, data-driven reasoning,”. To counter this, I am proposing that we implement mechanisms to make the Committee’s decision factors more accessible whether through publishing voting outcomes or enhancing the narrative content of our policy statements.”Dr. Asiama stated in his opening remarks. He argued that transparency and forward-looking guidance would be critical in managing inflation expectations and stabilizing the economy.
The Governor painted a complex picture of Ghana’s economic landscape. While recent trade surpluses and reserve growth largely driven by gold exports and remittance inflows offered some optimism, external risks loomed large. Rising geopolitical tensions, the threat of global tariff wars and weakening demand from China could quickly alter the country’s economic trajectory.
“Domestically, the 2024 fiscal outturn was expansionary, and while early 2025 has shown signs of consolidation, questions remain as to whether current measures are adequate to anchor expectations and satisfy upcoming IMF program reviews,” he noted.
With financial conditions evolving rapidly, banks have raised concerns about the Cash Reserve Ratio (CRR) framework, and liquidity pressures are mounting. Private sector credit, while improving in nominal terms, remains weak when adjusted for inflation, posing further challenges to economic recovery.
One of the most pressing issues before the committee is how to reinforce the disinflation path without stifling economic growth. The Governor acknowledged past policy missteps, including loose fiscal spending during periods of macroeconomic stress and weak coordination between monetary and fiscal authorities.
He urged the committee to not only address immediate concerns but also consider long-term structural issues, such as underinvestment in agriculture, exchange rate misalignments, and the need for deeper domestic financial markets.
“In short, we are facing a convergence of risks: stubborn inflation, elevated liquidity, soft real interest rates, a fragile fiscal recovery, and growing external uncertainty,” Dr. Asiama cautioned. “But we also have buffers strong reserves, improving sentiment, and the credibility of our policy framework to guide us.”
The 123rd MPC meeting is expected to conclude in the coming days, with policy decisions and an official statement to be released thereafter.
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