Ghanaian press focuses on increase in interest rate to 28% to tame inflation

The report that the Monetary Policy Com¬mittee (MPC) of the Bank of Ghana (BoG) has increased the Monetary Policy Rate…

The report that the Monetary Policy Com¬mittee (MPC) of the Bank of Ghana (BoG) has increased the Monetary Policy Rate (MPR) by one per cent from 27 per cent to 28 per cent in line with its monetary tightening stance to tame rising inflation is one of the trending stories in the Ghanaian press on Wednesday.The Ghanaian Times reports that the Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) has increased the Monetary Policy Rate (MPR) by one per cent from 27 per cent to 28 per cent in line with its monetary tightening stance to tame rising inflation.

The MPR is the rate at which the BoG lends to com¬mercial banks.

Dr Ernest Addison, Governor of the BoG and the chairman of the MPC, who announced the new policy rate at a news conference in Accra yesterday, said the hike in the MPR was to control the rising inflation in the country, which currently sits at 54.1 per cent.

He said the decision of the Committee was also influenced by the global and domestic macroeconomic factors.

He said the global economic outlook remained uncertain owing to broad-based and elevated inflation, policy tightening, worsening financing conditions, and lingering spillover effects of geopolitical tensions.

“These headwinds are likely to persist through the first half of 2023, driving down confidence and weakening real household disposable incomes in advanced and emerging market economies,” he said.

He said though showing signs of cooling, inflation levels remained elevated, and central banks, especially in advanced economies, had signalled the need to maintain the tight monetary policy stance to contain inflationary pressures, albeit, at a measured pace.

On the domestic economy, Dr Addison indicated that inflation remained elevated in 2022, driven by both demand pressures and supply shocks.

“The two price readings since the last MPC meeting showed a significant jump in headline inflation to 54.1 per cent in December 2022, from 50.3 per cent in November and 40.4 per cent in October 2022,” Dr Addison said.

He said the acceleration in inflation was driven mainly by the lagged effects of the sharp currency depreciation recorded in October.

The newspaper says that the World Health Organisation (WHO) has declared Ghana free of human African trypanosomiasis otherwise known as sleeping sickness.

This makes it the third neglected tropical disease (NTD) the country has eliminated in recent times as it strives to meet the WHO 2030 roadmap on NTDs.

In 2015 and 2018 respectively, Ghana received validation for the elimination of Guinea worm and trachoma.

The WHO Country Representative, Dr Francis Kasolo, made this known on the commemoration of World NTD Day in Accra yesterday.

Instituted four years ago, NTD Day is to mobilise political will and commitment towards eliminating some ‘ancient’ diseases that contin¬ue to pose a public health threat to the world.

This year’s celebration on the theme; “Act Now, Act Together, Invest in NTDs” calls for intensified efforts to ensure access to treatment and care for all persons affected with NTDs and increase surveillance for diseases earmarked for elimination.

Currently, Ghana is endemic for 14 out of the 20 NTDs the world is grappling with, with every district having at least two NTDs prevalence.

The new global NTD roadmap (2021-2030) requires however, that 100 countries eliminate at least one NTD by 2030 with all others decreasing the number of people requiring NTDs interventions by 90 per cent by 2030.

Dr Kasolo, lauding Ghana for the feat achieved in the fight against NTDs urged government to allocate adequate resources moving forward, to break further transmissions and attain elimination.

“For effective control and elimination of the NTDs that are endemic in Ghana, there need to be an improved healthcare services operating in an efficient health system with well-managed supply chain management which ensures universal access to quality assured medicines,” he said.

The Deputy Director Gener¬al of the Ghana Health Service (GHS), Dr Anthony Adofo Ofosu said, although most NTDs do not kill, its debilitating effects had huge socio-economic impact.

“NTDs perpetuate a cycle of poor educational outcomes and limited professional opportunities and are associated with stigma and social exclusion.

Everyone has a key role to play. By bringing renewed attention to NTDs, building political will and mobilising resources, and putting individuals and communities at the centre of the response, we can collectively generate the attention and resources needed to deliver against the targets outlined in the WHO 2030 NTD road map and SDG3,” he said.

The Graphic reports that the Director of Financial Market at the Bank of Ghana, Stephen Opata has said that the central bank has more gold for another oil shipment in the coming days.

He said the central bank had so far bought 50,945 ounces of gold which translates into US$96.6 million dollars.

“The first oil shipment, we paid US$40.6 million so we still have some balance there. We are expecting to buy another 20,000 ounces of gold this week and this should yield us about US$38.4 million.

“So the expected balance in the account should be around US$94.3 million so we have enough for another shipment and that is what we are working on,” he said in an interview on the sidelines of the MPC press conference.

He said the gold purchase arrangement was picking up and the country was expecting more shipment in February,

In December last year, Vice-President Dr Mahamudu Bawumia announced that Ghana had concluded talks for the operationalisation of the gold-for-oil policy.

He indicated that under the deal, which was similar to a barter, Ghana would receive cheaper fuel in exchange for gold.

The first consignment of policy arrived at the Tema Port last week and discharged into the receptacles of Bulk Oil Storage and Transportation Company (BOST).

The 41,000 metric tonnes of petroleum products was delivered by SCF YENISEI.

The newspaper says that the government has revised the terms of Domestic Debt Exchange Programme (DDEP) for individual bondholders who wish to participate in the programme.

Per the new terms, individual bondholders who are below the age of 59 years will be offered instruments with a maximum maturity of 5 years, instead of 15 years, and a 10 per cent coupon rate.

All retirees (including those retiring in 2023) will also be offered instruments with a maximum maturity of 5 years, instead of 15 years, and a 15 per cent coupon rate.

A release issued by the Ministry of Finance said discussions were also being finalised with Organized Labour and Pension Fund Trustees, on a separate arrangement in accordance with the Memorandum of Understanding signed with Organized Labour on 22nd December 2022, and in line with the government’s debt management Programme.

The release noted that these developments have necessitated the final extension of the deadline from January 31, 2023, to Tuesday, February 7, 2023, and a new settlement date of Tuesday, February 14, 2023, that will be confirmed via the new Exchange Memorandum.

With these new terms, the government in the release encouraged all stakeholders to participate in the DDEP, an essential step towards meeting the country’s debt sustainability targets and restoring macroeconomic stability and economic growth.

The release also affirmed that all individual bondholders are free not to participate; however, upon a successful DDEP there will be very few of the ‘old bonds’ in circulation, and likely limit its tradability.

The release also pointed out that significant progress had been made with all stakeholders, including financial sector industry associations and representative groups of individual bondholders, with respect to their participation in the DDEP.

“The Government hereby announces that based on the agreement reached with the Ghana Association of Banks (GAB), Ghana Insurers Association (GIA), and the Ghana Securities Industry Association (GSIA), the new terms of the exchange have been accepted.

“A revised and final Exchange Memorandum will be released by Thursday 2nd February 2023,” the release stated.

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