The International Monetary Fund (IMF) has urged the Bank of Ghana (BoG) to maintain a prudent, data-dependent monetary policy stance, cautioning against further interest rate cuts even as inflation continues to ease and markets anticipate lower borrowing costs.

The advice comes days after the BoG kept its Monetary Policy Rate unchanged at 14 percent for a second consecutive meeting, despite headline inflation remaining well within the central bank’s medium-term target band of 8±2 percent.

The July’s inflation rate of 4.6 percent have strengthened expectations among businesses that borrowing costs could decline further to support investment and economic activity. However, the IMF says the central bank should resist easing policy prematurely.

In its 2026 Article IV Consultation report, the Fund noted that the BoG’s cumulative 1,400-basis-point reduction in the policy rate since July 2025 has brought monetary policy to a broadly neutral stance.

It warned that additional rate cuts could shift policy from neutral to accommodative, a move the Fund said is unwarranted given lingering inflation risks.

According to the IMF, policymakers should remain cautious because of possible second-round effects from higher global energy and fertiliser prices stemming from the Middle East conflict, fiscal expansion under Ghana’s Policy Coordination Instrument, and the economy’s still-high exchange rate pass-through.

The Fund also acknowledged reforms to the BoG’s monetary operations, including the replacement of 56-day bills with 14-day bills and changes to cash reserve requirements aimed at strengthening liquidity management.

On the external front, the IMF said Ghana has continued to rebuild its reserve buffers, with gross international reserves reaching the equivalent of four months of import cover at the end of 2025, exceeding programme targets.

It nevertheless called on the central bank to adhere more consistently to its published foreign exchange auction guidelines to further improve transparency and policy credibility.