By 
Bank of Ghana on Monday (January 30, 2023) raised its prime interest rate by 100 basis points to 28% amidst the ongoing economic crisis triggered by a strong, high debt burden on fiscal position and covid-19 invasions in 2020.
Amidst a flurry of downgrades on sovereign ratings, lending rates across local banks has inched following a surge in monetary policy rates while the inflation rate continues to spark concerns.
In December, Ghana’s statistic office consumer inflation rise to 54.1% last month while its local currency faced a persistent decline due to a disequilibrium position created by high demand for foreign currencies for payments.
Foreign currency receipts remain under pressure from external influence driven by both COVID and Russia-Ukraine war.
In 2022, the cedi currency depreciated by more than 50% against the United States dollar, and interest payments on government debt have swelled to about 90% of Ghana’s gross domestic product (GDP).
While fighting to keep the nation on smooth sailing, the government obtained $3 billion in funding support from International Monetary Fund in 2022.
IMF requires the Ghanaian government to restructure its debts to get executive board approval which allows direct access to the fund.
Comments