Dollar outflows since January 2022 amount to $5.2bn – BoG Governor

 

Governor of the Central Bank, Dr Ernest Addison, has pegged dollar outflows from the Ghanaian economy since January this year to date at $5.2bn.

Making the assertion during a press briefing following the announcement of a new policy rate (27%) by the Monetary Policy Committee (MPC), the Governor noted that over $3.2bn have been used in interest payments and debt amortization since January this year.

Another $800m have been used for energy payments with some $1.2bn used for what he termed as “bank operations”.

The dollar outflows coupled with zero access to the Eurobond market, the Governor noted, has contributed to the decline in the country’s foreign exchange reserves.

“The significant decline in reserve buffers arising partly from loss of market access, significant portfolio reversals, rising petroleum product importation bill, market reaction to sovereign downgrades by rating agencies on fiscal concerns, alongside increased foreign exchange demand exerted intense pressures on the local currency.

In the year to November 24, 2022, the Ghana Cedi cumulatively depreciated by 54.2 percent, 48.9 percent, and 49.9 percent against the US dollar, the Pound, and Euro, respectively. In comparison with the same period of last year, the Ghana Cedi was much stronger, depreciating by 2.6 percent and 0.2 percent against the US dollar and the Pound, respectively, and appreciated by 6.6 percent against Euro,” quipped the Governor.

 

Ghana’s reserves at the end of October 2022, had declined to US$6.7 billion equivalent to 2.9 months of import cover compared with the reserve level of US$9.7 billion (4.3 months of imports) at the end of December 2021.

Net International Reserves, which excludes encumbered assets and petroleum funds, was estimated at US$2.8 billion as at October 2022.