The Bank of Ghana (BoG) says its recent reduction of the policy rate to 21.5% is expected to lower borrowing costs for households and businesses from October 2025.

Director of Research at the Central Bank, Dr. Philip Abradu-Otoo, explained that commercial banks are likely to follow the Monetary Policy Committee’s (MPC) decision by adjusting their lending rates downward.

Speaking in an interview with JoyNews on September 18, 2025, Dr. Abradu-Otoo noted that a similar rate cut in July prompted a 2.5 percentage point decline in lending rates, suggesting that the latest move could deliver even greater relief.

“We anticipate significant cuts in bank lending rates. The aim is to reduce the cost of credit, support businesses, and ultimately benefit consumers,” he said.

Inflation Concerns Addressed


The rate cut has drawn criticism from some analysts who argue it could weaken inflation control efforts. But Dr. Abradu-Otoo defended the decision, stressing that Ghana’s economic indicators remain strong.

“Our reserves remain robust, the cedi is stable, and growth is gathering pace. The data shows inflation will remain in single digits despite the policy rate adjustment,” he assured.

Banking Sector Outlook


Latest BoG data shows that Non-Performing Loans (NPLs) declined to 20.8% from 24.8%. The central bank says ongoing reforms are aimed at further strengthening the banking sector and improving credit delivery.

“We are confident the NPL situation will improve in the coming months. The focus now is to channel more credit into productive sectors to drive growth,” Dr. Abradu-Otoo added.

The BoG maintains that the rate cut is designed to consolidate economic recovery while safeguarding financial stability.