The Governor of the Bank of Ghana, Dr Johnson Pandit Asiama, has highlighted potential threats to Ghana’s recent economic progress due to escalating geopolitical tensions in the Middle East.
Speaking at the opening of the 129th Monetary Policy Committee (MPC) meeting in Accra, Dr Asiama noted that inflation in February fell to 3.3 per cent—the lowest level since August 1999—bringing it below the medium-term target band of six to 10 per cent. He credited disciplined monetary policy and improving domestic economic conditions for this achievement.
“We must make our decisions at the intersection of domestic success and external uncertainty,” he said, cautioning that rising oil prices linked to the conflict could trigger imported inflation, affecting transport, electricity tariffs, production costs, and consumer prices.
Dr Asiama also highlighted that global financial conditions had tightened, increasing borrowing costs and potentially limiting access to external financing for Ghana. At the same time, rising gold prices were cited as a positive factor, helping to bolster the trade balance and partly offset inflationary pressures.
He reported that Ghana’s international reserves had risen to US$14.5 billion, equivalent to 5.8 months of import cover, with a government target of 15 months by 2028. Fiscal performance had also improved, with a primary surplus of 2.6 per cent of GDP at the end of 2025, compared with a deficit of 3.9 per cent the previous year, reflecting stronger revenue mobilisation and expenditure discipline.
Dr Asiama pointed out that economic activity remained robust, with the composite index of economic activity rising by 8.4 per cent year-on-year at the start of 2026, supported by stronger business and consumer confidence and a gradual recovery in credit.
“The MPC’s decision this week will hinge on whether to maintain the current policy stance or adjust in anticipation of imported inflation pressures,” he said.
The committee is expected to announce its policy rate at the conclusion of the meeting on Wednesday, March 18, following the recent 350 basis point reduction from 18 per cent to 15.5 per cent. Dr Asiama emphasised that the central bank’s decisions must balance sustaining domestic progress with preparedness for external shocks.
