Ghana retains its position as the country in Sub-Saharan Africa with the third highest policy rate, according to the World Bank’s October 2025 Africa Pulse Report.
Despite a 7.5 percentage point reduction in the monetary policy rate since January 2025, Ghana’s benchmark rate still stands at 21.5%, although this is the lowest since October 2022.
The Bank of Ghana has attributed the cut in the policy rate to a sharp fall in inflation which is currently hovering in the single digit bracket. Countries like Kenya, Mozambique, Lesotho, and South Africa have either cut interest rates or paused contractionary monetary policies, while Mauritius and Zambia have raised rates due to inflation concerns.
The World Bank warns of potential headwinds from global economic uncertainty, commodity price fluctuations, and domestic conflicts that may heighten inflationary pressures.
Analysts have warned that Ghana’s high policy rate may impact businesses and individuals seeking loans, as borrowing costs remain elevated compared to regional peers. Indeed, the central bank’s decision to cut rates aims to stimulate economic growth while maintaining inflation control
“Other central banks in the region have recently raised rates due to a slight resurgence of inflation this year, namely Mauritius and Zambia”, the report stated.
It continued that potential headwinds from global economic uncertainty including sharp fluctuations in commodity prices and restrictive trade policies, domestic and regional conflicts and political instability as well as fiscal slippages may heighten inflationary pressures and risk delays in monetary policy normalization.
The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) in September 2025 cut the rate at which it lends to commercial banks by 350 basis points to 21.5%, the lowest since October 2022.
The central bank attributed the cut in the rate to sustained disinflation, robust growth and stronger external buffers.
