The Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has cautioned that Ghana’s improving economic outlook now presents policymakers with a more difficult policy judgment as they balance strong domestic gains against growing global uncertainty.
Delivering opening remarks at the 129th meeting of the Monetary Policy Committee (MPC) in Accra on Monday, Dr. Asiama said the central bank must decide how to sustain recent economic progress while navigating emerging external risks.
According to him, the latest data suggests that Ghana’s economy is performing stronger than many had anticipated. Headline inflation declined to 3.3 percent in February, marking the fourteenth consecutive monthly decline and falling below the central bank’s medium-term target band.
“These are numbers that, not long ago, would have been considered aspirational,” the Governor noted, adding that the trend reflects the impact of disciplined macroeconomic policies.
Ghana’s external buffers have also improved. Gross international reserves have risen to about US$14.5 billion, equivalent to 5.8 months of import cover, compared with approximately US$13.8 billion recorded at the time of the committee’s previous meeting in January.
Economic activity has also strengthened. The Composite Index of Economic Activity expanded by 8.4 percent year-on-year at the start of 2026, supported by stronger bank credit, increased industrial production, rising trade activity and improved household consumption.
Dr. Asiama said consumer and business confidence also increased in February as inflationary pressures eased.
Despite the positive domestic indicators, the Governor warned that developments in the global environment could threaten the progress made so far.
He pointed to the escalation of conflict in the Middle East, which has disrupted key energy and shipping corridors and increased volatility in global oil markets.
For Ghana, he said, the implications are clear: sustained increases in oil prices could raise the risk of imported inflation and potentially require policy tightening, with consequences for financial conditions.
While geopolitical uncertainty may also push gold prices higher and support Ghana’s trade balance, Dr. Asiama said the overall balance of risks remains inflationary.
He further noted that policymakers would also examine the implications of the government’s Ghana Accelerated National Reserve Accumulation Programme (GANRAP), which aims to raise Ghana’s international reserves to 15 months of import cover by 2028 from the current level of about 5.8 months.
According to him, while strengthening reserves enhances macroeconomic resilience, initiatives of that scale also raise important questions about liquidity conditions, the Bank of Ghana’s balance sheet and the interaction between reserve accumulation and monetary policy operations.
Dr. Asiama also stressed the importance of assessing the effectiveness of monetary policy transmission through the banking sector.
He said Ghana’s banking industry remains sound, profitable and well-capitalised, with asset quality improving significantly over the past year, a development that supports both financial stability and the effectiveness of policy decisions.
Understanding whether constraints to credit expansion stem from supply-side or demand-side factors, he added, will be key in determining how changes in the policy rate affect households and businesses.
The Governor said the committee must therefore make its decision at what he described as the intersection of “genuine domestic success and genuine external uncertainty.”
“The question before this Committee is not whether conditions have improved. They have, significantly and across the board.”
“However, how do we respond to that improvement when the conditions that enabled it are under pressure?” he said.
