A senior economist at Africa Policy Lens, Dr Eric Boachie Yiadom, is calling for the Bank of Ghana to cut the monetary policy rate to 20%, warning that the current rate is stifling access to affordable credit for businesses.
Dr Eric Boachie Yiadom, a senior fellow at Africa Policy Lens, has urged the Bank of Ghana (BoG) to reduce the monetary policy rate to 20%, citing recent improvements in key macroeconomic indicators.
Speaking on TV3’s 3Business show on Monday, 11 August 2025, Dr Yiadom argued that the policy rate, which influences lending rates across the banking sector, remains too high despite gains in the value of the cedi and falling inflation.
“With the money market indicators pointing in the right direction, the policy rate should have already come down to around 20%,” he said.
He warned that the current high rate continues to feed into commercial lending rates, limiting access to credit for the private sector.
“If we don’t tackle the monetary policy rate feeding into the lending rate, industry would suffer,” Dr Yiadom cautioned. “We should complete the cycle by making sure that policy rate is low and businesses are able to get funding at a cheaper cost.”
According to the economist, Ghana’s macroeconomic recovery driven by a more than 40% appreciation of the cedi and a reported 60% drop in inflation, should warrant a policy shift.
“These indicators show that things are better,” he noted. “But holding that link of the monetary policy at a very high rate creates a mismatch.”
The Bank of Ghana’s Monetary Policy Rate currently stands at 24.5% (as of its July 2025 review), having been reduced gradually from a peak of 30% in 2023. However, business groups and some analysts continue to argue that further easing is needed to stimulate private sector growth.
