Ghana’s Reference Rate has declined marginally to 14.58% in February, sparking hopes of a drop in interest rates. According to the Bank of Ghana, the rate, which serves as a benchmark for lending rates, has been trending downwards in recent months.
The decline is attributed to a combination of factors, including a decrease in inflation and a stable macroeconomic environment. Economists predict that the trend is likely to continue, leading to lower borrowing costs for individuals and businesses.
“The decline in the Reference Rate is a welcome development, and we expect it to translate into lower interest rates for borrowers,” said Dr. Samuel Kobina Annan, an economist at the University of Ghana. The Bank of Ghana is expected to continue its monetary policy easing, which could further drive down interest rates.
The Ghana Reference Rate is calculated based on the weighted average interest rates of banks’ lending and deposit rates. The rate has been on a downward trend since its peak in 2022, reflecting the country’s improving economic fundamentals.
A lower Reference Rate is expected to boost economic activity, particularly in the private sector, by making credit more accessible and affordable. As the economy continues to recover, stakeholders are optimistic about the prospects of sustained growth.
The decline in the Reference Rate is a positive development, and stakeholders are watching closely to see how it will impact the broader economy.
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Author: Korkor Anumu
