Ghana reported on Wednesday a further fall in annual inflation to 10.68 percent in May, a near one-percentage-point drop on April's figure that buoyed hopes of a further interest rate cut next month. However, analysts warned that increases in public sector wages and utility tariffs could soon start to reverse the trend in the West African economy and limit any future scope for monetary easing launched by the Bank of Ghana in late 2009, according to Reuters. "Everything still supports a Bank of Ghana rate cut of 100 basis points in July," Razia Kahn, head of regional research for Standard Chartered said of the next meeting of the bank's rate-setting committee. The prime rate stands at 15 percent. Bank of Ghana Governor Kwesi Amissah-Arthur told Reuters in a May 14 interview that he expected inflation to fall to single digits by September, and he signalled the bank could further cut the prime rate if the inflation and growth outlook permitted.
