BoG warns inflation could top 10% if high crude Oil prices persist
The Bank of Ghana is projecting that inflation could climb above 10% by the end of 2026 if international crude oil prices remain persistently high.
According to an internal projection model used to guide monetary policy and the central bank’s inflation-targeting framework, inflationary pressures could intensify if crude oil remains above US$100 per barrel through June.
If realised, inflation above 10% would breach the upper limit of the Bank of Ghana’s target band for both the year and the medium-term outlook.
Officials, however, stress that the projection is one of several scenarios under consideration and is not currently viewed as an immediate policy concern.
The Bank is closely tracking how higher global oil prices could feed into domestic fuel costs, transport fares and utility tariffs, all of which may contribute to upward pressure on inflation in the coming months.
The outlook is expected to inform discussions at the next meeting of the Monetary Policy Committee (MPC), scheduled for July 20 to 22, 2026, where policymakers will assess whether to maintain or adjust the policy rate.
Analysts suggest that the committee could either hold the rate steady or raise it if inflation risks worsen, a move that could translate into higher borrowing costs. The Ghana Reference Rate stood at 10.03% in May 2026.
Speaking at the Ghana–UK Investment Summit, Governor Johnson Pandit Asiama noted that geopolitical tensions in the Middle East could force the MPC to pause further interest rate cuts.
He added, however, that the Committee remains ready to respond swiftly should global conditions improve.
Some analysts also caution that prolonged instability in the Middle East remains a significant risk to Ghana’s macroeconomic stability if it continues to affect global energy markets.
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