Finance Minister Dr. Mohammed Amin Adam has assured Ghanaian businesses and market stakeholders that the Bank of Ghana (BoG) has adequate reserves to meet the country’s dollar demand. Speaking at a press briefing in Washington, D.C., held alongside the Annual IMF and World Bank meetings, Dr. Amin Adam emphasized the resilience of the BoG’s current reserve position, encouraging confidence among market participants.
“The Bank of Ghana has accumulated significant reserves to support demand,” he stated, underscoring BoG’s ability to stabilize the currency. BoG data indicates that Ghana’s international reserves stood at $7.5 billion at the end of August 2024.
Anticipated Inflows to Strengthen Reserves
Dr. Amin Adam also highlighted expected inflows that will further bolster BoG’s reserves, contributing to cedi stability. Ghana anticipates receiving $360 million from the IMF in December, pending the third program review’s approval. Additionally, the World Bank is expected to disburse $300 million under its Development Policy Operations (DPO) Series, injecting additional foreign exchange reserves into the economy.
“These inflows, alongside existing reserves, will help stabilize the cedi,” he added, addressing concerns around recent volatility in the forex market. While some forex bureaus are reportedly selling the dollar at over GHS17, the BoG reports most transactions are occurring below GHS16.
Market Pressures on the Cedi
Despite earlier stability, the cedi has faced mounting pressure recently due to increased dollar demand. Analysts attribute this to businesses preparing for Christmas imports and stock replenishment, as well as anticipated year-end depreciation. Concerns surrounding the upcoming December elections have also fueled demand, with some speculators seizing the moment to profit from uncertainties.
Bank of Ghana Interventions
The Bank of Ghana has responded to dollar demand by ramping up its dollar auction program, targeting key sectors such as Bulk Oil Distribution Firms and conducting weekly auctions for commercial banks to ensure currency availability. In addition, BoG has implemented various measures aimed at reducing market uncertainty and stabilizing the cedi as part of its broader monetary strategy.
Dr. Amin Adam’s reassurances aim to provide stability amid current fluctuations, affirming the BoG’s ongoing efforts to safeguard Ghana’s currency and maintain confidence among businesses and market stakeholders.
