Ghana Mining Companies Pledged to Sell Some Gold to Central Bank
Posted on 09/26/2022
Mining companies in Ghana have pledged to sell at least 125,000 ounces of gold to the Bank of Ghana in the last quarter of 2022. The reason is to expand Ghana’s foreign reserves. The cedi has fallen 39% against the U.S. dollar since January 2022. Ghana’s consumer inflation reached nearly 34% in August 2022, the highest since 2001 The central bank increased interest rates three times in March, May and August, with the Monetary Policy Rate currently standing at 22%. The surge in prices, high cost of living, and the steep fall of the Ghanaian cedi sparked street protests in the capital in June 2022.
The statement issued by the Ghana Chamber of Mines said the gold sales would be under the Bank of Ghana’s domestic gold purchase program against the backdrop of the Ghana’s weakening foreign exchange position. The Bank of Ghana will purchase a portion of the gold output of all the gold mining companies at world market price but pay for them in Ghanaian currency. Ghana is currently
Africa’s second-largest gold producer with 2.8 million ounces of gold in 2021.
It added this arrangement was to augment Ghana’s foreign exchange reserves over time and strengthen the country’s balance of payments position.
IMF
Ghana initiated talks with the International Monetary Fund for an IMF-supported lending program.
