BoG cuts policy rate by 300 basis points from 28% to 25%

The Monetary Policy Committee (MPC) of the Bank of Ghana has announced a 300 basis points reduction in the policy rate.

The new BoG cuts policy rate

This lowers it from 28 percent to 25 percent. The decision, taken at the 125th regular MPC meeting held between July 28 and July 30, 2025, was driven by sustained improvements in Ghana’s macroeconomic indicators.

The committee emphasized that the reduction was based on continued disinflation, improved fiscal metrics, and strong performance in the external sector.

The Governor stated that on the back of the strong external sector performance and increased reserve accumulation, the cedi has further strengthened against the major trading currencies.

He added that in the year to 25th July, 2025, the cedi appreciated by 40.7 percent against the US dollar, 31.2 percent against the British pound, and 24.2 percent against the euro.

“Overall, the Committee noted that macroeconomic conditions have significantly improved, inflation expectations are broadly anchored, external buffers have strengthened, and confidence in the economy is returning.

“The July forecast also shows that headline inflation is expected to decline further in the third quarter of 2025 and trend within the medium-term target of 8±2 percent by the end of 2025, earlier than initial projections. However, there are upside risks to the inflation outlook, which include potential supply chain challenges emanating from the global trade tensions, and upward adjustment in utility tariffs. This notwithstanding, the impact of these risks

“Given these considerations, the Committee, by a majority decision, voted to lower the Monetary Policy Rate by 300 basis points to 25.0 percent. Looking ahead, the Committee will continue to assess incoming data and likely reduce the policy rate further, should the disinflation trend continue. The Committee remains committed to the price stability mandate, while creating conditions for inclusive and sustainable growth”.