Dr. Ernest Addison, Governor of the Bank of Ghana, predicts a drop in inflation in the coming months. He says, measures put in place by the Central Bank will yield some fruits soon. Ghana’s inflation rate is currently 54 percent as of January 2023. The Governor of the Central Bank stated this during a meeting with CEOs of State Owned Agencies that the situation will change positively.
We expect that inflation will come down. That is good news. Because of the base figure effects, unless we get bigger shocks in 2023 which is very unlikely, we should see inflation coming down. Once we see inflation coming down, then we will see the monetary policy rate will also change.”
Ghana’s inflation rate has climbed more than expected, raising pressure on the central bank to continue increasing borrowing costs that are already at an all-time high. Economist, Prof. Godfred Bokpin has faulted government for its lack of credibility in controlling the country’s persistent increase in the rate of inflation.
He makes the point that despite several policy directives, managers of the economy have failed to significantly improve general price levels over the years. “It’s very difficult to trust government’s policy prescription and implementation when you see [inflation] variance at that level. Not everyone can do an inflation forecast, so we always turn to government’s budget, but it is always off the target, and it doesn’t help in credibility in government’s policy”, the Professor of Finance said.