Ghana Reference Rate edges up to 17.93% for November

The Ghana Reference Rate (GRR), which guides lending rates for commercial banks, has inched up slightly to 17.93% for November 2025, according to data from the Ghana Association of Banks.

This represents a marginal rise from 17.86% recorded in October. The October rate marked a notable 2% decline from 19.86% in September, continuing a downward trend seen earlier in the year.

At the start of 2025, the GRR stood at 29.72%, increased slightly to 29.96% in February, and gradually dropped to 19.67% in August before stabilising below 20% in October.

Analysts attribute the earlier decline to improvements in key economic indicators, including lower inflation, reduced Treasury bill rates, and a policy rate cut by the Bank of Ghana to 21.5%, a reduction of more than 600 basis points.

The new adjustment, though marginal, could influence lending costs in November.

Since the GRR serves as the benchmark for loan pricing, commercial banks are expected to make slight upward revisions to their interest rates.

Borrowers with fixed-rate loans will remain unaffected, while those with variable-rate loans may experience modest increases in their monthly repayments.

The rise in the GRR comes at a time when businesses continue to face challenges in accessing credit due to tight liquidity conditions. The Bank of Ghana’s ongoing measures to stabilise the economy and contain inflation have slowed private sector lending.

According to the latest Monetary Policy Report, average lending rates have declined from 26.6% to 24.2%, indicating a broader easing in credit conditions. Yields on short-term money market instruments have also dropped, with the 91-day Treasury bill rate falling from 13.4% in July to 10.3% in August 2025.

The Ghana Reference Rate, introduced in April 2017 at 16.82%, was developed by the Bank of Ghana and the Ghana Association of Banks to promote transparency in loan pricing.

It replaced the base rate model to ensure consistency across financial institutions and remains a critical tool in guiding lending decisions in the country’s banking sector.