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    BoG maintains policy rate at 14.5%

    The Bank of Ghana has maintained the monetary policy rate at 14.5%.

    This is the second time the Bank of Ghana has decided to keep its lending rate to commercial banks in the country.

    In a press release dated 31st January 2022, the BoG further stated the spillover of these events should be evident in 2022 adding, that it could cause currency pressures in emerging market economies with weak fundamentals and large foreign currency debt.

    The Central Bank noted that the rising long-term bond yields and a strong US dollar will characterize overall financial conditions, which are expected to tighten in 2022.

    “The Committee is of the view that the dynamics associated with the November 2021 policy rate hike are yet to be fully transmitted and expects the decisive implementation of the fiscal correction measures, especially the 20 percent cut in expenditure to help moderate the upside risks to the inflation outlook.

    “The Committee will continue to monitor the impact of these policy measures and as needed call an extraordinary meeting to re-assess the inflation outlook over the forecast horizon and take the necessary policy decisions accordingly,” the Bank of Ghana noted.

    The Monetary Policy Committee is of the view that the dynamics associated with the November 2021 policy rate hike are yet to be fully transmitted.

    According to the Committee, they also expect the decisive implementation of the fiscal correction measures especially the 20 percent cut in expenditure to help moderate the upside risks to the inflation outlook.

    “The Committee will continue to monitor the impact of these policy measures and as needed call an extraordinary meeting to re-assess the inflation outlook over the forecast horizon and take the necessary policy decisions accordingly,” it added.

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