Ghana Leads Africa in Interest Rate Decline, But Remains Second Highest

Ghana has witnessed a significant drop in interest rates since the start of the year, topping the list of 11 African countries. However, the country still maintains the second-highest interest rates on the continent, with Egypt holding the top spot.

The yield on Ghana’s 91-day Treasury bill has decreased by 3.94 percentage points to 24.48%, while the 182-day bill yield has dropped by 3.58 percentage points to 25.39%. This downward trend is expected to prompt the Bank of Ghana to reduce its monetary policy rate from the current 27%.

In contrast, Rwanda boasts the lowest interest rates in Africa, with its 91-day and 182-day Treasury bills yielding 7.05% and 7.39%, respectively. Nigeria’s interest rate environment remains high, with yields on 91-day and 182-day bills standing at 18.00% and 18.50%, respectively.

According to the Bank of Ghana, the country’s money market rates have broadly trended downwards. The 91-day and 182-day Treasury bill rates declined to 27.73% and 28.43% in December 2024, from 29.39% and 31.70% in December 2023.

The Interbank Weighted Average Rate (IWAR) also dropped to 27.03% in December 2024 from 30.19% a year earlier. This decline contributed to a reduction in average lending rates for banks from 33.75% to 30.25% over the same period.