The Bank of Ghana Monday increases its benchmark rate further by 150 bps to 29.5 percent, beating the expectation to retain it at 28 percent.
The hike announced by the Monetary Policy Committee of the Bank of Ghana is the second consecutive rate increase this year.
The new rate which aims at taming inflation and putting the economy firmly on the path of stability has now increased borrowing costs to their highest level since January 2001.
The headline inflation rate, though more than five times the 10 percent ceiling of the central bank’s target range, has dropped for the second consecutive month to 52.8 percent in February after reaching a record high of 54.1 percent in December.
The bank said inflation is expected to drop to 29 percent by the end of the year.
The latest hike comes amid the worst economic crisis in decades for a company that is in the process of restructuring its debt to secure a $3 billion loan from the International Monetary Fund.
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