The central bank, Bank of Ghana has held its lending rate, the prime rate still at 18.5%, following the effectiveness of the country’s economic stabilization process.
At a press conference of the Monetary Policy Committee (MPC) of the Bank, Tuesday July 21, 2009, the governor of the Bank of Ghana, Dr. Paul Acquah said “domestically, the last six months have seen a considerable uncertainty following from the large macroeconomic imbalances at the end of 2008, but also associated with the global financial turmoil.”
Dr. Acquah said these reflected in exchange rate expectations, inflation and inflation expectation, and general macroeconomic uncertainty.”
He however, indicated that a comprehensive policy framework has been put together which has been favourably considered and supported by resources of both the World Bank and IMF.
According to Dr. Acquah, the support of the two institutions is part of the stabilization process seen in other countries as a result of the global crisis.
He told the media that the underlying fiscal and monetary policies have been designed to unwind the imbalances that characterized the past 18 months, and further strengthen the consolidation process to secure economic fundamentals better to sustain rapid growth with finacial stability.
As a result of the stabilization processes, there are initial signs that point to an initial degree of unwinding in both the fiscal and external imbalances, some softening in general demand pressures, and declining volatility in prices and exchange rates, he said.
By Emmanuel K. Dogbevi