- September 26, 2022
- Posted by: Amos Ekow Coffie
- Categories: Banking and Finance, Economics
The Bank of Ghana (BoG) has signaled more hikes in the policy rate even as it awaits the outcome of discussions with the International Monetary Fund (IMF) to guide its decision.
The Monetary Policy Committee (MPC) should have announced the policy rate today, but rescheduled to October 7.
The policy rate has gone up 8.5 percent since November last year in a hid to tame inflation.
This has had adverse effect on interest rates, and cost of living.
But all indications point to further hikes in the policy rate when the central bank concludes engagement with the IMF.
With IMF known for its stance on hiking policy rate to fight inflation, it is more likely there will be a significant increase when the BoG announces its rate in October.
This has huge implications for the banking sector. Request for loans are already dropping, and this could affect interest incomes of banks, which is a major source of their revenue.
Treasury bills and bonds, which have been safe havens for banks, are no longer good options as government intends to restructure its debts.
But the big questions remains whether the latest challenges could potentially lead to another financial sector crisis as some analysts have said?