Ghana's central bank has raised its main interest rate by 200 basis points to 19% to control inflationary pressures and promote macroeconomic stability, Ernest Addison governor of the central bank announced on Monday.
Experts had predicted that the BoG was going to increase the policy rate following increases in the past two months.
In March, the Bank of Ghana raised its policy rate by 250 basis points to 17% - the largest hike in its history.
Subsequently, in April, the consumer inflation rate in the gold, oil and cocoa producer hit an 18-year high of 23.6%, as reported by Reuters.
"The committee took the view that it needed to decisively address the current inflationary pressures to re-anchor expectations and help foster macroeconomic stability," Addison told a press briefing in the capital Accra.
Business analysts had observed, that the rapid depreciation of Ghana's cedi has slowed but the currency has still lost over a quarter of its value since the year began.
Capital outflows have entirely offset a $1.3 billion trade surplus gained from a 61% jump in crude oil export revenues in the first quarter, the Reuters reports.
Addison said that had created an overall balance of payments deficit of $934.5 million in the first quarter compared with $429.9 million in the same period last year.