Governor of the Bank of Ghana (BoG), Dr Johnson Pandit Asiama, has admitted that the proposed utility tariff hikes put forward by power producers and distributors could weigh heavily on its next policy rate decision if approved.
The BoG governor made the remarks during the bank’s 126th Monetary Policy Committee (MPC) meeting held on Monday, September 15, 2025, with a focus on key developments shaping the economy. Members of the MPC also reviewed risks to the country’s disinflation path.
Consumer inflation fell to 11.5% in August 2025, dipping below the government’s year-end target of 11.9%.
Dr Asiama, speaking at the opening of the 126th MPC meeting, stated: “On the fiscal side, execution in the first half of 2025 signalled consolidation: the deficit on a commitment basis was contained at 0.7 percent of GDP, below target, contributing, together with cedi strength and external restructuring, to a decline in the public debt ratio by mid-year.
Against this backdrop of easing inflation pressures, anchored expectations, and stronger buffers, the MPC in July reduced the policy rate by 300 basis points to 25.0 percent.”
He added that while there are encouraging signs of fiscal stability, global trade risks and the looming tariff hikes will be critical in shaping the next policy stance.
“While reiterating our readiness to adjust as the disinflation process evolves and risks, such as global trade disruptions or prospective utility tariff adjustments, are assessed, our commitment remains firm: maintain price stability, safeguard financial stability, and create the conditions for inclusive, sustainable growth.”
The MPC’s deliberations will conclude with a press briefing on Wednesday, when the Bank of Ghana will announce its decision on the benchmark lending rate.
Utility providers have requested increases of more than 200% in both water and electricity tariffs, raising concerns that such adjustments could reverse recent progress in lowering inflation.
By Franklin ASARE-DONKOH