Finance Minister Dr Mohammed Amin Adam has reassured businesses and market stakeholders, stressing that the Bank of Ghana (BoG) holds sufficient dollar reserves to meet market demands.
“We should look at the current reserve position of the Bank of Ghana, and that should give everyone some comfort about its ability to meet market demand,” Dr Amin Adam stated.
He said this during a press briefing in Washington, D.C., held alongside the Annual IMF and World Bank meetings.
“I can tell you that the Bank of Ghana has accumulated significant reserves to meet the demand,” he added.
According to Bank of Ghana data, Ghana’s international reserves reached $7.5 billion by the end of August 2024.
Expected Inflows
The finance minister revealed that Ghana anticipates a December inflow of $360 million from the IMF, pending approval of the third program review.
“That should bring in some foreign exchange,” he noted.
Additionally, the World Bank is expected to disburse $300 million to Ghana under its Development Policy Operations (DPO) Series, further bolstering the country’s foreign currency reserves.
“In addition to what the Bank of Ghana already has, these expected inflows should help in stabilising the cedi going forward,” Dr Amin Adam remarked, addressing concerns about recent fluctuations in forex markets.
The assurance comes at a time when some forex bureaus are reportedly selling the dollar above GHS17, despite data provided to the Bank of Ghana showing transactions under GHS16.
Pressure on the Cedi: Contributing Factors
The Ghanaian cedi has faced mounting pressure over the past month, following a period of relative stability.
Market analysts attribute this volatility to a spike in dollar demand, as businesses prepare to finance imports ahead of the Christmas season.
Some commercial banks report that businesses are also rushing to restock for next year, fearing a depreciation of the cedi in the coming months.
Additional market pressures stem from speculation and concerns surrounding the upcoming December elections, which have increased demand for foreign currency, as well as the activities of speculators aiming to capitalise on uncertainties.
Bank of Ghana’s Role and Measures
The Bank of Ghana has actively intervened in the market to meet dollar demand, selling foreign currency through its dollar auction program.
It has specifically targeted Bulk Oil Distribution Firms and conducted weekly auctions for commercial banks to ensure a steady supply.
Furthermore, the Central Bank has implemented additional measures to stabilise the cedi, which it describes as part of a broader strategy to manage market uncertainty and minimise the negative impact on the currency’s value.
