The Bank of Ghana has announced that it will hold an Emergency Monetary Committee meeting from Wednesday August 17 2022.
According to a statement from the Bank of Ghana, the meeting will review developments in the economy over the past month.
Why this meeting now?
It is still not clear for now what might be the main reason for this meeting.
According to Bank of Ghana’s own calendar for Monetary Policy Committee Meeting, MPC members should have met next month- September 20th to 23rd, 2022.
However one cannot rule out the possibility of the BOG having taken some extra measures on the monetary side to check the rising inflation rate.
Others are also looking forward to some Foreign Currency Measures to check the Cedi’s sharp depreciation. But a source close to the Bank of Ghana has maintained that previous examples have shown that it’s never prudent to take emergency Foreign Exchange measures when the Ghana Cedi is depreciating, adding that “a similar measure taken in 2014 did not work.”
This, the source adds, could send negative signals to the market. The Bank of Ghana in a previous statement has assured the public that it is taking measures to stabilize the cedi and therefore advised businesses not to panic.
Monetary Policy Rate decision in July 2022
The Bank of Ghana at its last meeting in July 2022 left the rate unchanged at 19%, citing “deceleration” of the rate of inflation and concerns over economic growth.
The Bank of Ghana, since the end of 2021 has increased the Policy Rate by some 550 Basis points to try and contain the rising inflation rate. The Governor during the MPC press conference had indicated that the bank was pausing to observe the impact on inflationary pressures of recent rate hikes and other policies, “noting that the bank had observed that inflation had persisted and broadened to almost all items in the consumer basket” he added.
The Government at the last meeting also maintained that “the committee was of the view that it was appropriate to pause and observe the impact of the recent monetary measures already taken.”