Ghana’s average commercial lending rate fell to 15.64% in June 2026, its lowest level in more than a year, but rising Treasury bill and government bond yields suggest financial markets are becoming less confident that borrowing costs can continue falling at the same pace.
Figures from the Bank of Ghana’s latest Summary of Economic and Financial Data show that the average lending rate dropped from 27.00% in June 2025. That represents an 11.36 percentage-point reduction in the cost of bank credit over 12 months.
The Ghana Reference Rate, which commercial banks use as a benchmark when pricing loans, also declined sharply. It fell to 10.02% in June from 23.80% a year earlier, reflecting the wider easing in monetary conditions.
The reductions have followed more than a year of monetary easing designed to support growth after Ghana’s economic stabilisation. For companies, the change represents a major improvement in access to finance, with businesses that delayed expansion because of expensive credit increasingly able to consider bank borrowing again. Households are also benefiting from lower lending costs.
However, the government securities market is sending a more cautious signal.
The Bank of Ghana cut its benchmark policy rate from 28% in June 2025 to 14% by March 2026 through a series of reductions, as inflation fell sharply and broader macroeconomic conditions improved. The rate was left unchanged at 14% in June, suggesting policymakers believe monetary conditions are moving towards a more neutral level.
Lower short-term funding costs have helped banks reduce the rates charged to borrowers. The weighted average overnight interbank rate fell to 10.24% in June from 27.02% a year earlier.
Average lending rates declined consistently during the first half of 2026, moving from 20.58% in January to 19.17% in February, 17.74% in March, 16.33% in April, 15.83% in May and 15.64% in June.
But the pace of improvement has slowed. The Ghana Reference Rate edged down only slightly, from 10.06% in April to 10.03% in May and 10.02% in June. That pattern suggests much of the immediate benefit from monetary easing may already have passed through to the banking system.
Government borrowing costs rise
Treasury bill yields, which fell quickly during the first quarter, moved higher in the second quarter.
The yield on the benchmark 91-day bill rose to 5.27% in June from 4.89% in March. The 182-day bill increased to 7.21% from 6.51%, while the 364-day bill climbed more sharply to 11.29% from 9.57%.
The largest increase came at the longer end of the Treasury bill market, indicating that investors are seeking greater returns for committing their money over longer periods.
Yields on post-Domestic Debt Exchange Programme bonds also increased across most maturities in June. The five-year bond yield rose to 13.00% from 9.80% a month earlier, while the six-year bond increased to 12.84% from 10.56%.
Longer-term securities also became more expensive for the government to issue, with the 10-year bond yield reaching 14.33% and the 12-year bond yield rising to 14.92%.
Although yields remain well below their levels a year ago, the broad rise suggests investors are reassessing the returns required to hold government debt.
The Bank of Ghana did not give a specific explanation for the change. It came as headline inflation increased to 5.30% in June from 3.70% in May. While inflation remains historically low, the rise may have affected expectations about future real returns, particularly on short-term government securities.
Banks face a changing rate environment
The shift presents both opportunities and risks for commercial banks. Lending rates have fallen significantly, but deposit costs have remained largely stable.
The average savings rate was unchanged at 5.00% in June, while three-month and six-month time deposit rates both remained at 10.50%. Demand deposit rates fell to 1.12% from 2.63% a year earlier.
Stable deposit rates have so far helped banks adapt to lower lending rates without an immediate squeeze on profit margins. But continued increases in government security yields, alongside further pressure on loan rates, could make pricing more difficult in the months ahead.
Banks may therefore place greater emphasis on transaction banking, digital services and fee-based income rather than relying solely on interest revenue.
Borrowers continue to benefit from the most favourable average credit conditions in more than a year. However, the published lending rate is only a benchmark: the rate paid by an individual or business still depends on factors including creditworthiness, collateral, industry and repayment history.
The direction of interest rates during the second half of 2026 is consequently less certain. Monetary easing has reduced borrowing costs and improved liquidity, but the rebound in Treasury bill and government bond yields points to growing market caution over inflation, government borrowing and longer-term interest rates.
Ghana is entering a new phase of the rate cycle. Credit is considerably cheaper than it was a year ago, but further reductions may be slower and more difficult unless inflation stays contained and fiscal conditions continue to improve.
