The Bank of Ghana (BoG) has kept the policy rate at 13.5 per cent.
Speaking at the Monetary Policy Committee (MPC0 press conference in Accra on Monday September 27, Governor of the BoG Dr Ernest Addison said inflation has risen sharply over the last two readings, driven mainly by sustained food price increases.
He added although food inflation has pushed overall inflation close to the upper limit of the band, core inflation remains relatively subdued.
In the view of the Committee, the increase in inflation is mainly due to food inflation which is expected to abate with the onset of the harvest season.
This notwithstanding, the latest forecast indicates that inflation will remain within the medium-term target band, but closer to the upper limit in the near-term, in the absence of further unexpected shocks.
“A close monitoring of the inflation situation is however warranted to respond swiftly to prevent potential second round effects on headline inflation from the rising food inflation.
“The Committee stands ready to respond appropriately as needed if this particular risk materialises.
“Given these considerations, and the fairly balanced risks to inflation and growth in the outlook, the Committee decided to keep the policy rate at 13.5 percent.”