BoG in better position to cushion economy against external shocks – Governor

•
Dr Addison

The Bank of Ghana (BoG) is better positioned to cushion the country’s economy against external shocks and provide stability in the foreign exchange market, Dr Ernest Addison, the BOG Governor, has stated.

According to him, both the bank’s reserve build-up had been strong and the external payments position improved in the first half of the year.

“The current account surplus significantly improved, aided by strong gold exports, robust remittances, and effect of the debt suspension. This development, along with the Domestic Gold Purchase Programme, helped accumulate reserves faster than envisaged under the IMF-supported programme,” Dr Addison, who is the chairman of the MPC, stated this at a press conference held in Accra on Friday.

The BoG maintained the monetary policy rate, the rate at which the central bank lends to commercial banks, at 29 per cent.

He said there had been significant build-up in the country’s international reserves during the first six months of the year and the country’s Gross International Reserves (GIR) stood at $6.87 billion at the end of June.

“GIR increased by $947 million to $6.87 billion at end-June 2024, equivalent to 3.1 months of import cover. Net International Reserves also increased by $1.31 billion to $4.50 billion at end-June 2024. The higher build-up in Gross International Reserves was aided by the strong performance of the domestic gold purchase programme,” he stated.

He said prices of Ghana’s major export commodities traded mixed on the international market.

Cocoa price futures bounced back after declining by 19.2 per cent in May 2024, to $9,022.6 per tonne, representing 1.1 per cent growth in June 2024.

Crude oil prices, the Governor said, remained broadly stable in June 2024 with an average price of $83.01 per barrel. Spot gold prices, however, dropped marginally by 1.1 per cent to close at an average price of US$2,325.34 per fine ounce in June 2024.

Dr Addison said the trade balance improved in the first half of the year driven by higher exports relative to imports and the country’s trade surplus improved to $1.81 billion in the first half of the year, compared to the surplus of $1.60 billion recorded in the corresponding period of 2023.

“Total exports increased by $1.01 billion to $9.23 billion, while imports rose by $884.5 million to $7.42 billion,” he said.

BY KINGSLEY ASARE