On Wednesday, August 17, 2022, the Bank of Ghana's Monetary Policy Committee (MPC) will convene in an emergency session. The BoG stated that the meeting's purpose was to assess recent economic developments. On Monday, August 15, a statement read, "The meeting will conclude with an announcement of the Committee's decisions."
In a previous statement, the regulator urged restraint as it adopted measures to address the Cedi's demise. The BoG has determined five major causes of the local currency's problems. The US dollar's strength, investor response to a credit rating downgrade, non-rollover of maturing bonds, the steep increase in crude oil prices and their effect on the oil bill, and the loss of external financing are these.
"Gold Purchase Program to increase foreign exchange reserves; Special Foreign Exchange Auction for the Bulk Distribution Companies (BDCs) to help with the importation of petroleum products; Bank of Ghana is entering into a cooperation agreement with the mining companies to provide BOG with the opportunity to buy gold as it becomes available," are the measures put in place to address these, according to the BoG.
"To help fulfill the demand for external payments, the Bank of Ghana is providing the banking sector with foreign currency liquidity. Once disbursed, the recently granted USD 750,000,000 Afriexim credit facility by Parliament will strengthen the country's foreign exchange position and support confidence building. In the fourth quarter of the year, the cocoa loan is anticipated.
Additionally, this facility will contribute to the provision of more foreign cash to combat the cedi's depreciation. When the IMF program is finished, we anticipate that it will significantly contribute to regaining investor confidence in the economy and stimulating portfolio flows.
According to a statement released by the BoG, these actions will significantly improve the Central Bank's foreign exchange reserve position.
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