Despite recent increases in inflation, the Bank of Ghana is confident that prices for goods and services would decline over the next few days, weeks, and months.
This vow was made after rising food and transportation costs caused the rate of inflation to jump from 23.6 percent in April 2022 to 27.6 percent in May 2022.
The Monetary Policy Committee of the Central Bank is working assiduously to reduce the rate of inflation in order to stabilize the economy, according to Dr. Philip Abradu Otoo, Director of Research at the Bank of Ghana, who was speaking at a financial literacy program for journalists.
He claims that the Central Bank is optimistic about the likelihood of a soon-to-be-attained reduced inflation rate.
He added that while the Central Bank’s monetary policy is aimed on bringing down inflation in the non-food category, the recent rains will help in the agriculture sector’s bountiful crop, helping to cut food costs.
Although there has been a little decrease, the governor, Dr. Ernest Addison, stated during a news conference that inflation will peak between June and July 2022. This time, the figures were a little strong, but I believe they will decline since the situation cannot last indefinitely.
The monetary policy will start to function. While the monetary policy continues to focus on the non-food sector, our conversation with the meteorological department reveals that this year’s rainfall are better than those from last year, which predicted an improvement in the food situation somewhere in September .
Additionally, according to Dr. Otoo, the economy’s recovery following the COVID-19 and the unsustainable debt brought on by the depreciation of the cedi are to blame for the decline in reserves.
“The first is debt, which is a financial issue and is eating away at some of our reserves. The government often gives cedis to the Central Bank in order to pay its debt, and we then rely on our reserves to satisfy our debts,” he said.
“We are returning, and the COVID-19 economy is improving. Additionally, economic activity has increased and imports have increased tremendously, he insisted.
“Sustaining the recovery, the role of the media in fostering confidence” was the focus of the session on financial literacy for journalists.