The Bank of Ghana is urging commercial banks to lower their lending rates as inflation rates have declined slightly.
Ghana might just be seeing the light at the end of the tunnel as its inflation rate which has been on an upward trajectory for close to two years has seemingly begun to decline.
The Ghana Statistical Service (GSS) has indicated that the country’s inflation rate for April 2023 was 41.2 percent, a drop from that of March 2023 which stood at 45 percent.
In the wake of this report, the BoG has called for all commercial banks to lower their lending rates.
In an event organized by Absa Bank in collaboration with the Mastercard Foundation for the inception of a loan scheme for small businesses, the Second Deputy Governor of the Central Bank, Elsie Addo Awadzi expressed that the recent decline in the country’s inflation rate spells a positive trend as far as the economy is concerned.
“As the economy picks up and there is a signal of improvement in the macro economy, we expect things to get better. Moments ago, before I got here, inflation had dropped to 41.2% for April  from the about 50% some months ago.”
“We as a regulator and at the Monetary Policy Committee project that things will improve. The inflation rate will drop further and lending rates will come down. I, therefore, encourage you all as banks to emulate Absa Bank and bring the lending rates further down,” she added.
Ghana’s inflation rate in the previous year
As of September 2022, the country’s inflation rate stood at 37.2% from 33.9% in August, according to a GSS report. This saw prices of food and services balloon with experts predicting worse in the coming months and year. Some predicted as far as a 50% inflation rate by the end of the year 2022.
Despite efforts of the government to strengthen the cedi, its value kept diminishing.
By the end of 2022, the Ghana Statistical Service recorded a 54.1 inflation rate.
Categories used in calculating the rate included; Housing, Water, Electricity, Gas, and Other Fuels (82.34%); Furnishings, Household Equipment (71.52%); Transport (71.42%); Personal Care, Social Protection, and Miscellaneous Goods and Services (60.94%) and Food and Non-Alcoholic Beverages (59.71%).
Food prices went up by 4.4% in December 2022, but prices for everything else went up from 46.5% in November 2022 to 49.9% in December 2022.
Meanwhile products made in the country had an inflation rate of 51.1%, while things from other countries had a 61.9% inflation rate.