The Bank of Ghana raised its benchmark monetary policy rate by 100 bps to 28% during its January 2023 meeting, below market forecasts of 28.75%, bringing borrowing costs to the highest since at least the 2000s, to try to tame soaring inflation and shore up its currency.

The annual headline inflation rate is quintuple the 10% ceiling of the central bank’s target range, having reached 54.1% in December of 2022.

The economic growth slowed to 2.9% in the third quarter of 2022 from 4.7% in the prior three months and is likely to remain subdued due to the debt crisis and spending pressures.

The cedi currency has depreciated around 50% against the dollar last year, as the country is facing multiple financial and economic challenges in its worst economic crisis in decades.

Meanwhile, Ghana has secured a US$3 billion bailout from the International Monetary Fund to help it restore macroeconomic stability.

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Credit: tradingeconomics