By Nadia Ntiamoah
At a post–Monetary Policy Committee (MPC) press briefing on Wednesday, 28 January 2026, the Governor of the Bank of Ghana, Dr. Johnson Asiama, offered a wide-ranging defence of the central bank’s policy direction, addressing concerns over foreign exchange management, gold reserves, inflation targeting, banking sector stability, and the future structure of the financial system.
The briefing followed the Bank’s 128th MPC meeting, where the Committee cut the policy rate by 250 basis points, a decision that has sparked debate about the balance between growth, inflation control, and currency stability.
FX Reserves, Imports, And Production Structure
Responding to questions on whether Ghana’s strong international reserves were simply financing consumption imports, Dr. Asiama explained that the FX market remains market-driven, with the central bank auctioning foreign exchange through banks.
He noted that balance-of-payments data shows intermediate goods imports remain stronger than consumer goods imports—an indicator, he said, that production inputs are still being prioritised over pure consumption. However, he acknowledged the broader structural challenge of shifting the import profile toward capital and industrial goods to deepen local value addition.
Liquidity, Credit And Real Sector Growth
On monetary policy transmission, the Governor rejected suggestions that easing would fuel inflation through excessive liquidity.
He stressed that although the Bank has begun easing the policy rate, it has maintained tight liquidity management through aggressive sterilisation.
According to him, this approach protects macroeconomic stability while gradually redirecting credit from government borrowing toward private sector lending—a shift he described as “real financial intermediation” that supports growth, jobs, and poverty reduction.
Gold Reserves and Portfolio Rebalancing
One of the most closely watched disclosures was the sharp fall in gold holdings—from over 30 tonnes in 2024 to 18.6 tonnes by December 2025. Dr. Asiama explained that the decline was the result of deliberate portfolio rebalancing rather than reserve depletion.
He said the gold exposure had exceeded peer-country norms, prompting diversification into interest-earning foreign assets. While acknowledging record global gold prices, he cautioned that price surges are often driven by transitory factors and cannot be assumed permanent, stressing that reserve management must remain conservative and structurally grounded.
BoG Finances And Recapitalisation
Ahead of the publication of the Bank’s 2025 financial statements, the Governor admitted that monetary policy operations, revaluation costs, and gold-related expenses have weighed on the central bank’s balance sheet.
However, he confirmed that the amended Bank of Ghana Act provides for government recapitalisation, and that discussions with the Ministry of Finance are ongoing to restore the Bank’s financial strength.
He described recapitalisation as a matter of fairness, given the central bank’s role in absorbing shocks from crisis interventions such as the Domestic Debt Exchange Programme.
Gold-for-Reserves And Accountability
On the Domestic Gold Purchase Programme, including Gold-for-Reserves and Gold-for-Oil, Dr. Asiama confirmed that cost data had been submitted to Parliament’s Public Accounts Committee and disclosed that audits are ongoing. He reiterated that while the programme began as a crisis-response tool, reforms are underway to reduce costs, strengthen risk management, and streamline operations to support reserve accumulation sustainably.
Lending Rates, Cedi Stability And Inflation Targeting
Although careful to say it is a personal aspiration rather than official policy, the Governor expressed optimism about the gradual fall in lending rates, noting that banks are now actively inviting customers to apply for loans—an unthinkable scenario a year earlier when lending rates hovered around 30%.
On the cedi, he dismissed fears over a marginal January depreciation, describing Ghana’s exchange rate regime as a managed float where short-term fluctuations are normal. Stability, he stressed, is about limiting excessive volatility, not fixing the currency at artificial levels.
He also ruled out any immediate review of the inflation target band (8 ± 2%), despite inflation falling to 5.4% in December 2025, saying more data is needed before reconsidering the medium-term framework.
Banking Sector Reforms And Recapitalisation
Dr. Asiama confirmed that 21 out of 23 banks had met capital adequacy requirements by December 2025, with only two banks given until end-March 2026 to comply. He described this as evidence of progress in the recapitalisation strategy and broader banking sector reforms.
He also reaffirmed plans for the central bank to divest its residual shares in ADB, stressing that the regulator cannot remain both supervisor and shareholder, and disclosed that Board approval has already been granted for the divestment process.
COCOBOD Pressures And Structural Reform
Turning to the cocoa sector, Dr. Asiama acknowledged the financial strain facing COCOBOD, arising from falling cocoa prices and FX dynamics linked to cedi appreciation.
He described the challenges as “real” and signalled that Ghana may need to fundamentally rethink the COCOBOD operational model, arguing that structural reform—not just currency management—will be necessary to resolve the sector’s long-term vulnerabilities.
Bigger Banks And Consolidation Agenda
On financial sector structure, the Governor openly supported consolidation, arguing that larger banks with deeper capital bases are better positioned to finance large-scale national projects under government initiatives such as the “Big Push” agenda.
He confirmed that the Bank of Ghana’s regulatory framework actively encourages mergers that strengthen financial capacity and risk management.
Overall, the briefing painted a picture of a central bank shifting from crisis stabilisation to structural rebuilding—balancing reserve management, growth support, financial sector reform, and institutional credibility.
