The Ghana National Chamber of Commerce and Industry is challenging claims by the Bank of Ghana that the hike in the policy rate is to control inflation and liquidity in the system.

According to the Chamber, the method adopted by the regulator to tame down inflation is not effective as inflation rather keeps increasing.

It contend the 30% policy rate will complicate the current challenges facing the industry and result in further shut down of businesses.

Speaking to Joy Business, Chief Executive Officer of the GNCCI, Mark Badu-Aboadgye, maintained, if the government continues to impose taxes, controlling inflation will be difficult.

“If you continue to increase the tariffs, this monetary policy will not work. Food inflation is very high and we are not getting food. Monetary policy will not work. Is not more money in the pocket of people chasing fewer goods, is a supply side constraint”.

“Food is not there. Producers are producing at a higher cost and will translate to higher prices leading to inflation”, he added.

He argued that the monetary policy has not been effective in controlling inflation and thus cannot solve the country’s soaring inflation.

“Monetary Policy has not been effective and I have said it and am going to say, they can continue to increase monetary policy, but it’s not going to solve the inflation that we have”.

Ghana's annual inflation rate rose slightly for the second month running to 42.5% in June 2023, from 42.2% in the prior month and well above the central bank's target band of 6% to 10%.

The acceleration in overall inflation was largely driven by rising prices for food and beverages (54.2% from 51.8% last month).