The Bank of Ghana raised its key lending rate 100 basis points to 13.50% from 12.50% previously. Bank of Ghana Governor, Kwesi Amissah-Arthur, said: "The Committee concluded that the balance of risks to inflation is elevated. To contain future inflation pressures and realign interest rates in favour of domestic assets, it is necessary that monetary policy continues to be fine tuned to ensure that inflation expectations remain anchored to keep inflation within the target band."
The Bank of Ghana previously held the rate unchanged after reducing its lending rate by 50 basis points to 12.50% at its July meeting, after also cutting 50 basis points at its May meeting last year. Ghana reported annual inflation of 8.6% in December, 8.55% in November, up slightly from 8.4% in September, August, and July, compared to 8.6% in June, 8.9% in May, 9.0% in April, and 9.1% in March.
Ghana's economy grew 12% year on year in the September quarter (17.6% in Q2, 19.1% in Q1), as Africa's newest oil exporter saw export earnings boosted by oil sales, as well as a high gold price and cocoa volumes. Ghana's currency, the cedi (GHS) has weakened by about 12% against the US dollar so far this year, with the USDGHS exchange rate last trading around 1.68.