The Bank of Ghana (BOG) has revealed that the inflation target band will be revised in 2026 after a long period of stable inflation within the target band.
The Bank related to the assertion that, having achieved the year’s inflation target early and maintained inflation within the medium-term target band, it is natural that the Bank and fiscal authorities would consider revising the band.
However, inflation has been at the target for only three months, and the Bank of Ghana needs to allow inflation to be firmly anchored within the band for a longer period before revising the inflation target band downward.
In addressing the media and stakeholders, the Bank expressed confidence in its strategy and consolidation with the government to protect the declining inflation and maintain it either lower or within the inflation target band. Adding that, the band’s review will happen in due time.
BOG’s Inflation Target Band
The Bank of Ghana operates within a medium-term inflation target band of 8 percent plus or minus 2 percentage points, a range of 6 percent to 10 percent. Before the beginning of this year, the actual inflation rate peaked at over 54 percent in December 2022 and at 23.8 percent in December 2024. The inflation began falling from January 2025 (23.5 percent) and has been falling to date.
Though the headline inflation rate has been falling throughout the year, it remained significantly above the target band until September, with the year-on-year headline inflation dropping to 9.4 percent, falling within the band. The inflation rate continued its decline in October at 8.0 percent (exactly at the midpoint of the target) and subsequently to 6.3 percent in November.
Ghana’s inflation rate has only met the Bank of Ghana’s target for three recent months (September, October, and November 2025) because it had been exceptionally high for years. The recent drop is the result of an eleven-month continuous decline driven by a combination of tight monetary policy, a stable cedi, and improved supply conditions.
BOG’s Committed to Anchoring Inflation in the Band
According to the Bank of Ghana, its operations remain committed to monetary discipline and continue to maintain a strict adherence to the IMF-ECF program that discourages monetary financing of the Goldbod or the government due to its inflationary risks.
The Bank clarified that it only “acts as an intermediary between the commercial banks and GoldBod by taking cedis from these institutions and transmitting same to GoldBod to purchase gold, which is later sold for forex and given back to the banks.” Also, the Bank “uses high-powered money to purchase gold from GoldBod to build its reserves.”
According to the Bank, it is aware that any form of monetary financing risks fueling inflation, which contradicts its core mandate of price stability. The Bank assured the public that it remains committed to preventing such outcomes to protect Ghana’s economic recovery.
The Bank, however, continued to encourage “parliamentary scrutiny and public accountability to dispel misinformation and reinforce trust in its operations.”
BOG’s Coordinated Achievement
The Bank of Ghana’s three-month achievement of the inflation rate within the target band rests on many prudent and coordinated factors.
Major on the Bank of Ghana’s side is the monetary policy adjustment. The Bank of Ghana implemented an aggressive easing strategy, where the policy rate was reduced from 21.5 percent to 18 percent to sustain the decline in inflation, stabilize the currency, and achieve a more favorable macroeconomic outlook.
The stabilized Ghana Cedi is supported by strong prices of key exports like cocoa and gold, and also by the IMF-supported economic program. A stronger cedi makes imports cheaper, which eases price pressures on imported goods.
With the improved agricultural projects and output leading to moderation in the food price increases – which is a major component of the inflation basket – the country has experienced reduced prices and a slow rise in general prices. Food inflation dropped to 6.6% in November 2025, entering single digits for the first time in over four years.
The government’s efforts toward fiscal discipline and consolidation, as well as a broader stabilization program, have built confidence and supported the disinflation process.
Whereas the current disinflation is the result of a sustained downward trend over the course of 2025, the target band needs to be maintained while the Bank of Ghana works towards a long-term trapping of the inflation rate within the range.
In the meantime, monetary and fiscal authorities should continue playing their respective cautious and vigilant roles in ensuring further inflation decline in the coming months.
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