Ghana’s central bank governor says a synchronised improvement in key economic indicators reflects coordinated monetary and fiscal policy, as inflation, interest rates, and the currency stabilise after years of crisis.

Bank of Ghana Governor Johnson Asiama said the broad-based gains recorded over the past 13 months demonstrate the interconnected nature of policy tools and outcomes.

“They are all interconnected. When you influence one, it reflects in all the other rates,” he said at a fireside chat hosted by the Ghana Export Import Bank, the Business and Financial Times (B&FT) reported.

The turnaround has been striking. Headline inflation fell sharply from 23.1% in February 2025 to 3.2% in March 2026, a drop of 19.8 percentage points. Over the same period, the benchmark Monetary Policy Rate (MPR) was cut from 27% to 14%, while the Ghana Reference Rate declined from 29% to 14%.

Average bank lending rates also dropped from 30.12% to 19.7%, while the cedi strengthened significantly, with the US dollar selling rate improving from GHS15.3 to GHS10.95. Gross international reserves rose from $8.9bn to $13.8bn.

The recovery marks a sharp reversal from the period leading up to Ghana’s 2022 fiscal and debt crisis, when inflation surged, the cedi depreciated and reserves dwindled. Inflation peaked at 54.1% in December 2022, the highest level in two decades.

Asiama said the central bank’s strategy focused on absorbing excess liquidity to directly tackle inflationary pressures, rather than relying on exchange rate intervention or administrative controls.

As inflation eased, the Monetary Policy Committee gained room to reduce the policy rate, triggering a downward adjustment in reference and lending rates. The exchange rate then strengthened organically, without direct fixing.

He warned that reversing this sequence could have been destabilising. Cutting rates too early risked reigniting inflation and weakening the currency, while defending the cedi without addressing inflation would have depleted reserves.

“This is not the first time Ghana’s economy has suffered a global shock. We will get through it,” he said, pointing to Middle East tensions as the main external risk through oil price volatility and imported inflation.

Asiama highlighted lending rates as the most critical improvement for businesses.

“Lending rates for me is the most important one and I have always said it,” he said. “If you borrow money at over 30%, can you really repay it? It is not surprising that non-performing loans are very high.”

Despite the sharp decline, borrowing costs remain elevated in real terms, with a gap of about 16.4 percentage points between lending rates and inflation.

He said sustained stability could also shift long-standing behavioural patterns around the cedi.

“For decades, people assumed the cedi is going to fall by 20% next year, and so you price accordingly. We had to reset this whole thing,” he said.

“If we are able to sustain these gains for another year, I am quite sure that people will not have to be compelled to price in the dollar. They themselves will see the need to operate in the cedi zone.”