Ghana Leads Africa in Monetary Easing with 1,400-Basis-Point Cut, but Faces Continent’s Highest Lending Rates

Ghana has emerged as Africa’s most aggressive monetary easing economy, according to the African Development Bank’s (AfDB) African Economic Outlook 2026 report. Under the leadership of Governor Dr. Johnson Asiama, the Bank of Ghana implemented an unprecedented 1,400-basis-point reduction in its benchmark policy rate, slashing it from 28.0% in January 2025 to 14.0% by March 2026. This bold monetary shift was primarily driven by a dramatic cooling of the country’s inflation rate, which plummeted from a staggering 54.0% in early 2023 to just 3.4% by April 2026. This transition was further supported by robust fiscal consolidation measures and the early conclusion of the International Monetary Fund (IMF) Extended Credit Facility program.

The country’s aggressive easing cycle is anchored by strong macroeconomic fundamentals that signal a significant economic recovery. In 2025, Ghana recorded a real GDP growth rate of 6.0%, bolstered by favorable global gold prices and steady cocoa exports. The external sector also showed remarkable resilience, with the country reporting a current account surplus of $9.4 billion and building gross international reserves to $14.5 billion. These factors, combined with a recovering cedi, provided the Central Bank with the necessary buffer to pivot toward growth-oriented policies while moving away from the restrictive stance necessitated by the previous inflationary crisis.

Despite these policy successes, a significant disconnect persists between the Central Bank’s benchmark rate and the cost of credit for the private sector. The AfDB report highlights that Ghana currently records the highest average commercial lending rate in Africa at 16.33% as of April 2026. Although this is a reduction from the 20.58% seen in January 2026, the pace of decline has not matched the Central Bank’s aggressive cuts. Local businesses continue to struggle with these high costs, as commercial banks have been slow to adjust their interest rate structures to reflect the new monetary environment, presenting a lingering hurdle for domestic investment and expansion.

In recent months, the Bank of Ghana has opted to pause its monetary easing cycle, maintaining the policy rate at 14.0% during its most recent Monetary Policy Committee meeting. This decision comes in response to a slight uptick in domestic inflation and heightened geopolitical tensions that threaten global economic stability. To manage liquidity while monitoring these risks, the Central Bank has also revised the Cash Reserve Ratio. Moving forward, the Bank remains in a monitoring phase, balancing the need to support Ghana’s 6.0% growth trajectory against emerging external pressures and the need to ensure that the benefits of monetary easing are more effectively transmitted to the broader credit market.