Bank of Ghana Refutes Claims of Dollar Injection to Stabilize Cedi

 

Governor of BOG

The Bank of Ghana (BoG) has categorically denied allegations suggesting that it is injecting substantial amounts of US dollars into the foreign exchange market to stabilize the Ghanaian cedi. In a recent appearance on the business edition of PM Express, Dr. Johnson Asiama, the BoG Governor, emphasized that the cedi's recent stability is not a result of central bank interventions but rather due to robust foreign exchange inflows and ongoing market reforms.

Dr. Asiama clarified that the BoG's reserves program is strengthening over time, contributing to the cedi's resilience. He highlighted that the central bank's approach focuses on enhancing market fundamentals rather than direct market interventions. The Governor also noted that the BoG aims to maintain the cedi within a reasonable range aligned with macroeconomic stability, avoiding both excessive depreciation and over-appreciation.

This clarification comes amid discussions about the effectiveness of currency interventions. Some economists, such as Kwame Pianim, have criticized the practice of injecting dollars into the market, arguing that it is a short-term solution that does not address underlying economic issues. Instead, they advocate for structural reforms and policies that promote domestic production and reduce reliance on imports.

In summary, the Bank of Ghana asserts that the recent stability of the cedi is attributable to improved foreign exchange inflows and strategic market reforms, rather than direct dollar interventions. The central bank remains committed to ensuring the cedi's stability through sound economic policies and regulatory measures.