February 2, 2023

Caribbean Broadcasting Corporation

The most credible news source in Barbados

Ghana hikes lending rate as inflation nears 40%

Ghanaian cedi stock photo

Diaspora Network Television – The cost of loans in Ghana is set to increase again for the average borrower, following an upward review of the rate at which banks can borrow money from the central bank, Bank of Ghana, otherwise referred to as the policy rate.

The central bank has announced a hike in the policy rate by 250 basis points to 24.5 per cent, from 22 per cent in August, the highest increment since 2017.

This will further worsen the high cost of living in the country.

The move, according to the central bank, is to curb the rising inflation of nearly 40 per cent.

Inflation in the country is likely to go up significantly in the coming months following recent adjustments in utility tariffs and local currency depreciation.

Multiple credit rating agencies have downgraded the economy to junk status, meaning the country is no longer credit-worthy.

Ghana is currently negotiating a GH¢$3 billion (1 Ghanaian cedi = 19 Barbadian cents) International Monetary Fund bailout programme to run for three years.

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