Average lending rate or cost of loans have fallen by 2.59percent to 21.10percent within the last one year, the Bank of Ghana has revealed in its January 2020 Summary of Financial and Economic Data.
But between October 2020 and December 2020, interest charged on loans went down by 0.16percent.
Though cost of borrowing is still high compared to the nation's peers on the African continent, it has gone down by about 10percent since Dr. Ernest Addison's administration took over the reins of Bank of Ghana.
According to the data from the Bank of Ghana, Ghana's reference rate has fallen by 1.34percent within the last one year, from 16.11percent in December 2019 to 14.77percent in December 2020.
The cost of credit however varies among the commercial banks, as they price their rate based on their risk analysis and also risk of customers.
Some banks offer as low as 17percent for lending, whilst others have rates as high as about 28percent.
When it comes to interest rates on Government of Ghana securities, the rates have also dropped but marginally.
For instance, yield on 91-day Treasury bill has fallen by 0.61percent in December 2019 to 14.08percent in December 2020.
Also, interest on the 182-day T-Bill has dropped by 1.02percent in the last one year to 14.13percent in December 2020.
Fitch Solutions forecasts ease in Ghana's interest rates
Research arm of ratings agency, Fitch, earlier forecast an ease in interest rates in the country, from early next year.
It linked that to a further fall in the country's inflation rate next year, which then will remain in the single digit bracket. It is projecting an end-year inflation of 8.5percent for 2021.
Senior Country Risk Analyst for Sub Saharan Africa, William Attwell told Joy Business a further drop in inflation will trigger monetary policy easing and interest rates.
"We would expect monetary policy easing during 2021 because of a further fall in inflation. We're expecting inflation to ease further next year and that will facilitate that process too. That's really an austere on the monetary front for Ghana"