MPC Meets On Friday
Paa Kwesi Amissah-Arthur, Governor of Bank of Ghana The Monetary Policy Committee (MPC) of the Bank of Ghana would on Friday December 10, 2010 announce the end-of-year Monetary Policy Rate when it ends its economic review meeting. The last of the periodic meetings for the year commences on Monday December 6, 2010. The Policy rate is the rate at which commercial banks borrow from the central bank and therefore gives an indication of the direction of the general interest rates charged on loans by banks. The last MPC meeting in September 2010 saw the rate Policy Rate maintained at 13.5 percent. That was the first time in 2010 the rate had been maintained after continuous cuts in line with the positive trends in the key economic indicators including inflation rate among others. The Governor, Paa Kwesi Amissah-Arthur attributed the decision to a major risk-factor of the economy operating below its potential coupled with projected weak economic conditions. Analysts generally believe the policy rate is likely to be maintained again. This, they argue citing the marginal declines in the inflation rate in recent months coupled with the slow pass through of the previous policy rate cuts to the lending rates of banks. Maintaining the Policy rate would imply the year ended at the current rate of 13.5 percent compared with the 18 percent it began with – representing a cumulative reduction of 450 basis points through the year.