Accra, Feb 5, GNA- The Government remains committed to bringing 12-month CPI inflation down to below 10 per cent in 2004, Minister of Finance Yaw Osafo Maafo said on Thursday in his budgetary statement to Parliament.
To achieve the inflation objective, he said the Bank of Ghana "intends to keep the pace of monetary expansion consistent with the targeted inflation rate".
"This implies bringing the 12-month growth rate of broad money (excluding foreign currency deposits) down from 37.8 per cent at end-December 2003 to around 19.0 per cent by end-December 2004." He said the intermediate goal of 18.8 per cent growth in reserve money (excluding banks' foreign currency deposits) during 2004 would be pursued in support of this objective.
"The Bank of Ghana will use open market and repurchase operations, and adjustments in its prime rate to achieve its monetary objectives. "In order to secure the desired build-up in international reserves of at least three months of imports cover, Bank of Ghana's net domestic assets will be reduced further in 2004."
Mr Osafo-Maafo said the Bank of Ghana would continue to allow the cedi exchange rate to be market determined, limiting interventions to smoothing short-term fluctuations in the exchange market and ensuring achievement of the targeted build-up of international reserves.
