The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) has increased the policy rate by 100 basis point to 22 percent.
[contextly_sidebar id=”FvCousUTOnjAp0JaGOeVwXUWDbMM9Sa7″]The latest move comes at a time where the central bank has come under severe pressure to reduce its lending rate following the country’s high interest rates.
The surge in the policy rate means persons who have contracted loans which do not have fixed interest may experience an increase on interest of the loans.
The policy rate which is the rate at which the central bank lends to commercial banks and is also used by banks to calculate their base rates was at 21 percent prior to the increment.
This is the highest rate since December, 2003 when the rate was at 21.50 percent.
Industry players fear the latest hike will lead to an increase in interest rates which hover around 35 percent on the average.
But Governor of the Bank of Ghana Dr Henry Kofi Wampah says the increment may have been higher.
According to him due to good fiscal consolidation the rate was only increased by 100 basis points.
More to come.
By: Vivian Kai Lokko/citifmonline.com/Ghana