BoG Governor, Dr. Johnson Asiama
Ghana’s gross international reserves have climbed to about $14.5 billion, strengthening the country’s ability to withstand external shocks, the Governor of the Bank of Ghana, Dr. Johnson Asiama has announced.
Speaking at the opening of the 129th Monetary Policy Committee (MPC) meeting, he said the reserve position has improved significantly since the committee’s last meeting.
“External buffers have strengthened further. Gross international reserves now stand at about $14.5 billion, up from the over $13 billion at the last meeting.”
According to him, the current reserve levels provide stronger protection for the economy.
“Current levels are equivalent to 5.8 months of import cover.”
The Governor noted that the strengthening of the country’s external buffers is one of the key indicators pointing to improved macroeconomic stability.
Dr.Asiama explained that together with other economic indicators, the development suggests the economy is stabilising faster than many had expected.
“Taken together, these indicators point to an economy that is stabilising more quickly than many had expected.”
He added that the improved reserves position is also important for maintaining investor confidence and helping the country absorb potential shocks from the global economy.
The Governor further indicated that reserve accumulation will remain a key priority for policymakers as government rolls out a new initiative aimed at significantly boosting Ghana’s external buffers.
“Since our last meeting, the government has announced the Ghana Accelerated National Reserve Accumulation Programme, an ambitious one,” he said.
According to him, the programme seeks to substantially increase the country’s reserve position over the medium term.
“It seeks to raise international reserves to 50 months of import cover by 2028, compared to current levels of around 5.8 months of import cover.”
However, he noted that programmes of that scale also require careful policy coordination.
“Strengthening external buffers is an important element of macroeconomic resilience. But initiatives of this scale raise questions regarding liquidity conditions, the impact on the central bank’s balance sheet, and the interaction between reserve accumulation and monetary policy operations.”
The Monetary Policy Committee is expected to take these developments into account as it deliberates on the appropriate policy stance for the economy.
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Source: www.myjoyonline.com