The Bank of Ghana has reduced its Monetary Policy Rate (MPR) by a significant 300 basis points, bringing the rate down from 28 percent to 25 percent. The decision was announced on Wednesday, July 30, following the conclusion of the central bank’s 125th Monetary Policy Committee (MPC) meeting, which took place from July 28 to 29, 2025.
This marks the steepest policy rate cut in recent years and signals a decisive shift toward supporting economic recovery amid easing inflationary pressures.
The policy rate—used as the benchmark for lending rates across the banking sector—is the central bank’s primary instrument for controlling inflation and steering overall monetary conditions in the economy.
A reduction in the rate typically leads to lower interest rates on loans and improved access to credit for businesses and consumers.
The BoG cited continued declines in headline and core inflation, relative stability in the foreign exchange market, and improvements in fiscal performance as factors that created room for the policy easing.
“The decision to reduce the policy rate reflects the Bank’s assessment that inflation risks have continued to abate and that further tightening is no longer necessary under current conditions,” the Committee said.
Inflation, which peaked at over 50 percent in late 2022, has steadily declined over the past 18 months, supported by a tight monetary policy stance and coordinated fiscal measures. As of June 2025, headline inflation stood at 22.8 percent, down from 23.1 percent in May.
The central bank, however, noted that it remains vigilant to potential risks, including external shocks and domestic price volatility, and will act promptly should inflationary pressures resurface.
The next MPC meeting is scheduled for September 2025.
