Skip to main content

IMF aware of “Gold 4 Oil” programme – Governor Addison

 


Governor of the Bank of Ghana (BoG), Dr Ernest Addison, has said the International Monetary Fund (IMF) is aware of government’s plan to purchase refined crude oil with gold.

Speaking at a press briefing following the announcement of a new policy rate on Monday, November 28, the Governor averred that although the IMF is aware of government’s “Gold for Oil” policy, discussions on the policy are still ongoing in view of the fact that Ghana is yet to attain a Staff Level Agreement with the Bretton Wood Institution.

Governor Addison made the assertion in response to the question on whether or not the IMF is aware of the new policy amid ongoing negotiations with the Fund.

Ghana ordered large gold-mining companies to sell 20% of the metal they refine to the nation’s central bank, as the government embarks on a plan to barter bullion for fuel.

The directive will be effective Jan. 1, Minister for Lands and Natural Resources Samuel Jinapor said in a notice posted on Vice President Mahamudu Bawumia’s Facebook page. The government also ordered small-scale miners to sell their gold to the state-owned Precious Minerals Marketing Co.

Ghana is struggling to stem a slide in the cedi, which has dropped 57% this year, making it the world’s worst-performing currency. Bawumia said on Thursday the government was planning to use bullion to buy fuel in an attempt to reduce demand for dollars.

The Bank of Ghana and the government’s marketing arm will buy the gold from companies including Newmont Corp., AngloGold Ashanti Ltd., Gold Fields Ltd. in “cedis at spot price with no discounts,” according to the notice. Ghana is Africa’s second-biggest gold producer.

Meanwhile, the Central Bank has once again increased its monetary policy rate by 250 basis points (2.5%).

On the back of the increment, the Bank of Ghana’s monetary policy rate rises to 27% from the previous rate of 24.5%

Cumulatively, the policy rate hikes by the Central Bank since November last year, comes to some 1,250 basis points (12.5%).

The hike in policy rate by the BoG is on the back of the increment in the country’s headline inflation rate which hit a record high of 40.4% in October.

Given the hike in policy rate, interest rates on loans to the private sector is expected to increase, further making costs of production by businesses in the country more expensive.

Announcing the new policy rate, the Governor of the Central Bank, Dr Ernest Addison, noted the Bank’s decision to increase the policy rate is due to significant upside risks to the country’s headline inflation as inflation is expected to remain elevated in the short term.

 

Labels:

Comments

Post a Comment

Popular posts from this blog

Fitch Solutions retains 2025 growth rate projection at 4.2%

 Fitch Solutions has reaffirmed its projection that Ghana’s economy will expand by 4.2% in 2025. This estimate slightly exceeds the International Monetary Fund’s forecast of 4% and the World Bank’s projection of 3.9%. The UK-based research firm attributes its outlook to historically high gold prices, which are expected to cushion the Ghanaian economy against a global slowdown triggered by rising tariffs. Higher gold prices are anticipated to strengthen government revenue, enhance foreign exchange earnings, and help sustain currency stability. The report also highlights that Ghana is relatively less vulnerable to increasing trade restrictions from the United States, given that its primary exports—gold and crude oil—are not directly affected by the tariffs introduced by President Trump’s administration. Moreover, the US constitutes only about 4% to 5% of Ghana’s total exports. In contrast, Ghana’s trade relations are more heavily oriented toward China and European countries, particul...
Post a Comment
Read more

BoG injects $20m into FX market to support 11 BDCs

  The Bank of Ghana (BoG) has injected $20 million into the foreign exchange market in the latest round of its forward FX auction targeted at Bulk Oil Distribution Companies (BDCs). The intervention, which benefited eleven BDCs, is part of the central bank’s broader strategy to stabilise the cedi and ensure price stability in the petroleum downstream sector. Held on Tuesday, April 29, the auction was priced at a locked exchange rate of GHS 14.28 to the US dollar, with bid offers ranging from GHS 13.85 to GHS 15.55. This move reflects the BoG’s continued effort to deepen forex liquidity and safeguard the domestic fuel supply chain against volatility in global energy markets. By directly supplying FX to BDCs, the central bank seeks to ease pressure on the interbank market, guarantee the uninterrupted flow of petroleum products, and mitigate the pass-through effects of exchange rate fluctuations on fuel prices. The $20 million disbursement forms part of a $120 million programme for th...
Post a Comment
Read more

Kenpong Travel & Tours Champions Breast Cancer Awareness During Customer Week

  As part of activities to mark Customer Week, Kenpong Travel & Tours, a leading travel agency in Ghana, is joining the global fight against breast cancer. October is Breast Cancer Awareness Month, and the company is passionate about spreading hope and support to those affected. At Kenpong Travel & Tours, we believe that travel and exploration can be therapeutic and empowering. That's why we're committed to supporting our customers and the broader community in the fight against breast cancer. We're proud to stand in solidarity with breast cancer warriors and survivors. At Kenpong Travel & Tours, we believe that everyone deserves a chance to explore the world and create unforgettable memories. Let's prioritize health, support one another, and fight against breast cancer," said Kennedy Agyapong, CEO of Kenpong Travel & Tours. Our efforts are focused on raising awareness, promoting early detection, and supporting those affected by breast cancer. We urg...
Post a Comment
Read more