The Bank of Ghana is widely anticipated to maintain a tight monetary policy well into 2026, a move driven by concerns over potential inflationary pressures following recent tariff adjustments.

According to IC Securities, a leading market and research firm, the real policy rate is expected to remain in double digits throughout the first half of 2026. This cautious approach is intended to prevent a second-round effect stemming from the increases in utility tariffs.

IC Securities’ analysis suggests that if the real policy rate rises above 12.0% by the end of 2025, the Monetary Policy Committee (MPC) will likely pause further rate cuts in January 2026.

In November 2025, the MPC concluded its final meeting for the year by reducing the policy rate by 350 basis points, bringing it down to 18.0%. While the cut was largely expected, it was 50 basis points less than the firm’s maximum projection of 400 basis points.

“We view this deep, yet cautious, rate cut as a signal of the MPC’s continued preference for double-digit real policy rates throughout this easing cycle, which began in July 2025,” IC Securities stated in its report.

The reduction effectively lowered the real policy rate from 13.5% to 10.0%, keeping the monetary stance firmly restrictive. Authorities believe maintaining this position is crucial to managing inflation.

IC Securities anticipates that the double-digit real policy rate will persist until the first half of 2026, aligning with the cautious approach outlined in the 2026 budget statement. The budget notes that any further easing of monetary policy will be conditional on sustained economic stability.

The Bank of Ghana has also signaled its readiness to swiftly re-evaluate and adjust its policies should inflationary risks re-emerge, demonstrating a proactive stance towards maintaining price stability in the country.

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