Some economists are hopeful the Bank of Ghana (BoG) will meet its single digit inflation target.
They argue that efforts by the Central Bank not to finance government’s budget deficit and tightening of the financial sector should curtail any possible distortions to the target.
The Bank of Ghana is seeking to bring inflation down to 8 percent, plus or minus two by next year.
The International Monetary Fund(IMF) in its latest statement also advised the BoG to remain vigilant in order to bring inflation back to lower level.
In an interview with Citi Business News, Economist Professor Godfred Bokpin was of the view that the Bank of Ghana can achieve its inflation target especially with the extension of the IMF program.
“I think that with the extension, we are in a better position to be able to measure on what is expected of us on the program. An extension per say is not the solution but what to do within this extended period is what will make the difference”.
He argued that “the time left under the original program was insufficient for Ghana to to address the structural weaknesses in the economy.
He pointed out that there is the need for the fiscal policies to reduce the pressures in the financial sector in relation to the energy sector debt.
“The financial pressure in terms of the state owned energy companies and their indebtedness to certain banks which in itself were not conducive for financial stability will require some attention from policies that will ease the pressure.” he stated.
By: Jessica Ayorkor Aryee/citibusinessnews.com/Ghana