The Bank of Ghana has kept it policy rate-the rate at which it lends to commercial banks at 14.5%.
It cited the balance of risks to inflation and growth as the rationale behind the unchanged policy rate.
“Risks to inflation in the near-term are broadly contained, but short to medium-term risks emanating from the fiscal expansion and rising crude oil prices are emerging.”
The unchanged policy rate means cost of loans will remain same at least for the next two and half months, unless some factors ease it slightly.
Prior to the policy rate announcement, some economists and analysts wanted a cut in the policy rate to stimulate spending and growth.
Nevertheless, average lending rate or cost of loans have fallen by 2.59% to 21.10% in the last one year. It has also gone down by about 10% since April 2017.
Interest rates remains stable
Interest rates on the money market broadly showed downward trends across the yield curve.
The 91-day declined to 14.1%in December 2020 from 14.7% last year, and the 182-day Treasury bill rate fell to 14.1% from 15.2 percent over the same comparative period.
On the secondary bond market, yields on 6-year, 7-year, 10-year, and 15-year bonds all declined.
The rates on the 20-year bond, however, inched up marginally to 22.3% in December 2020 relative to 22.1% in December 2019.
The weighted average interbank rate declined to 13.6% from 15.2%, reflecting the reduction in the monetary policy rate in March 2020, and improved liquidity conditions on the market.
Similarly, average lending rates of five banks declined to 21.1% in December 2020 from 23.6% recorded in the corresponding period of 2019, consistent with the monetary policy stance.
Latest Stories
-
Boeing strike ends as workers accept new contract
36 mins -
GAF will not relent in its quest to counter external threats – GOC Southern Command
39 mins -
Election 2024: Bawumia reiterates commitment to promote sustainable mining practices
41 mins -
Ensign Global College promotes health and community well-being at Ngmayem Festival 2024
43 mins -
Bobrisky reveals reason for leaving Nigeria
1 hour -
Tiwa Savage discloses ‘craziest thing I’ve ever done for love’
1 hour -
US states worried about election unrest take security precautions
2 hours -
Modi condemns violence after Canada temple incident
2 hours -
Barcelona hit by new flood as rescuers search Valencia basement car park
2 hours -
Labadi Beach Hotel pays over GH¢16m as dividend to SSNIT
2 hours -
Elon Musk can keep giving $1m to voters, judge rules
2 hours -
Election must not divide us, government will protect each citizen – Akufo Addo
3 hours -
Novel way to beat dengue: Deaf mosquitoes stop having sex
3 hours -
Trial begins over beheading of teacher who showed Prophet Muhammed cartoon
3 hours -
‘See you soon’ – Bobrisky jets out of Nigeria
3 hours