Business News of 2026-09-23
BoG warns Ghana’s reserves face pressure as inflation climbs to 5%
Ghana’s gross international reserves currently provide about 4.2 months of import cover, but the Bank of Ghana (BoG) has warned that the country’s external position could face increased pressure in the third quarter.
Speaking at the start of the Bank’s 132nd Monetary Policy Committee meeting, Governor Dr Johnson Asiama identified a number of developments that could weaken Ghana’s external buffers.
These include a projected current account deficit, a possible decline in reserves and the suspension of gold exports by the Ghana Gold Board since mid-August.
Dr Asiama said the developments would require close monitoring, particularly as demand for foreign exchange typically increases during the fourth quarter.
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“Three particular issues will shape our discussions during this meeting, each carrying its own risk. Rebuilding reserves will be a key priority for the Bank in the coming months,” he said.
The outlook for Ghana’s reserves is expected to feature prominently in the MPC’s deliberations as the Committee considers the risks affecting the economy and determines the appropriate monetary policy direction.
Inflation has also become a growing concern.
Headline inflation increased from 3.2% in March to 5.0% in August, representing a 1.8 percentage-point rise over the five-month period.
Although inflation remains below the lower limit of the BoG’s medium-term target range, Dr Asiama noted that the recent upward movement requires attention.
The Governor said policymakers must determine whether the expected rise in inflation will be temporary, largely reflecting higher energy costs and adjustments in administered tariffs, or whether it could become more persistent and influence inflation expectations.
The MPC is therefore considering the interaction between renewed inflationary pressures and the country’s weakening external position.
The Committee will also determine whether the current policy rate of 14% remains suitable amid changing domestic conditions and developments in the global economy.
Its decision will be closely monitored by businesses and financial markets for indications of the Bank’s approach to balancing inflation, reserve accumulation and economic growth.
FKA/AM
