Ghana's average lending rate declined sharply to 15.64% in June 2026, extending a broad reduction in borrowing costs over the past year. This significant drop from 27.00% in June 2025 represents an 11.36 percentage-point decrease within 12 months. The Bank of Ghana's July 2026 Summary of Economic and Financial Data confirmed this trend.
The reduction in lending rates was primarily driven by the Bank of Ghana's monetary easing cycle. The Ghana Reference Rate, a key benchmark for commercial bank loans, also fell to 10.02% from 23.80% during the same period. This 13.78 percentage-point decline reflects significant easing in the monetary policy rate, interbank rate, and Treasury bill yields, all of which influence the reference rate calculation. The monetary easing has begun to transmit to the credit market, lowering the indicative cost for businesses and households to access bank financing.
This development fits into Ghana's broader economic narrative of managing inflation and stimulating economic activity. The Bank of Ghana's monetary policy rate remained at 14.00% in June, unchanged since March 2026. This rate had decreased from 28.00% in June 2025 to 14.00% by March 2026. This cumulative 14.00 percentage-point reduction over 12 months established a substantially lower benchmark for financial market pricing. Interbank rates, the rates at which banks lend to each other, also declined to 10.24% in June 2026 from 27.02% a year earlier, indicating improved liquidity within the banking system.
However, the decline in lending rates appears to be losing momentum. The average lending rate fell only marginally from 15.83% in May to 15.64% in June. Similarly, the Ghana Reference Rate saw only a slight decrease from 10.03% in May to 10.02% in June. This suggests that the downward adjustment may be approaching a floor under current market conditions. Treasury bill rates, which had dropped steeply earlier in 2026, have also begun to rise. The interest-equivalent yield on the 91-day Treasury bill increased from 4.89% in March to 5.27% in June. The 364-day bill saw a more pronounced rise, from 9.57% to 11.29% over the same period.
The increase in Treasury yields indicates that investors are demanding higher returns, especially for longer-term instruments. The secondary government bond market showed a similar pattern, with yields on most post-Domestic Debt Exchange Programme bonds rising in June. For example, the five-year bond yield climbed sharply to 13.00% from 9.80% in May. The eight-year bond yield increased to 14.16%, and the 10-year yield rose to 14.33%. This broad increase across the yield curve suggests a reassessment of the returns investors require to hold longer-term government debt.
The Bank of Ghana report does not explicitly explain this rebound in government security yields. However, it coincides with a rise in headline inflation to 5.30% in June from 3.70% in May. While inflation remains low compared to 2025 levels, this increase may influence investors' assessment of real returns, particularly on short-term government instruments. Deposit rates showed less movement, with the average savings deposit rate remaining at 5.00% in June. Rates on three-month and six-month time deposits were unchanged at 10.50%.
Moving forward, decision-makers and markets will closely watch the interplay between lending rates, Treasury yields, and inflation. The potential for a slowdown in lending rate reductions, coupled with rising government borrowing costs, could impact future credit availability and economic growth. The Bank of Ghana will need to carefully manage its monetary policy to balance inflation control with supporting economic expansion. Investors will continue to monitor inflation trends and government fiscal requirements to gauge future yield movements.