Prime News Ghana

BoG maintains policy rate at 14.5%

By Justice Kofi Bimpeh
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The Monetary Policy Committee of the Bank of Ghana has maintained the policy rate at 14.5 percent after a similar decision in May this year.

The rate is of keen interest to businesses, as it determines the rate at which the BoG lends to commercial banks, and subsequently influences interest rate on loans.

The Governor of the Central bank, Dr. Ernest Addison, attributed the decision to uncertainties in the financial sector caused largely by the Covid-19 pandemic.

In March this year, the MPC reduced the rate by 150 basis points from 16 percent to 14.5 percent, and the figure was maintained in May 2020.

Dr. Ernest Addison says maintaining the policy rate was necessary to ensure price stability and also help cushion various businesses amidst the Covid-19 pandemic.

READ ALSO : BoG must ensure policy rate translates into lower credit rates for businesses - Chamber of Commerce

The Committee made the announcement after holding its 95th regular meeting from Wednesday to Friday, July, 24, to review developments in the economy.

The Governor also admitted to increased uncertainty in the sector which has been triggered by the second wave of covid-19.

This culminated in a negative spill over, resulting in a weaker growth and negative impact on export, Foreign Direct Investment (FDIs) among others.