The Bank of Ghana’s Monetary Policy Committee (MPC) has kept its benchmark monetary policy rate at 14 percent. The central bank cited rising external inflation risks, specifically from escalating tensions in the Middle East.
Governor Dr. Johnson Pandit Asiama announced that the central bank will change its cash reserve ratio framework. All commercial banks must now maintain a uniform 20 percent reserve requirement. This reserve must be held entirely in Ghana cedis. This new rule takes effect on June 4, 2026.
This is another change to the Bank’s reserve management rules. In May 2025, banks had to hold reserves in the same currencies as their deposits. Dr. Asiama stated the committee reviewed the previous framework after seeing its results. He added that the new framework will support the Bank's liquidity operations. It will also help with the transmission of monetary policy.
The Bank of Ghana will meet with commercial bank executives. These meetings will clarify how the new reserve requirement will work. These measures to control liquidity come as the MPC holds the main borrowing rate steady. Policymakers are balancing rising external risks with easing price increases inside Ghana.
The Bank explained that ongoing conflict in the Middle East has affected trade routes. It has also pushed up energy prices. This has created more global policy uncertainty. The blockade of the Strait of Hormuz has especially contributed to higher crude oil prices. This has renewed inflation worries in both rich and developing countries.
The International Monetary Fund (IMF) has lowered its global growth forecast for 2026. It is now at 3.1 percent, down from an earlier 3.3 percent. Further cuts to this forecast are possible if the conflict continues. The MPC warned that long-lasting geopolitical tensions could keep crude oil prices above US$100 per barrel. This would likely cause fuel price increases to affect transport and utility costs in Ghana.
Despite these outside risks, the Bank stated that Ghana's economy remains strong. The Composite Index of Economic Activity grew by 12.6 percent year-on-year in March 2026. This is much higher than the 2.3 percent growth a year earlier. Stronger private sector credit, industrial production, consumption, and trade activities supported this growth.
Credit to the private sector increased by 28.7 percent in nominal terms for April 2026. This compares to 19.9 percent growth during the same time last year. In real terms, after accounting for inflation, credit expanded by 24.5 percent. This is a significant improvement from a contraction of 1.1 percent a year earlier.
Financial conditions in Ghana also continued to improve. The return on the 91-day Treasury bill, a short-term government debt, fell to 4.9 percent in April. This is a sharp drop from 15.5 percent a year before. Average bank lending rates also decreased to 16.3 percent from 27.4 percent. However, the central bank cautioned that high credit risk remains a concern. It stated that banks must strictly follow rules aimed at reducing bad loans.