BoG suspended forex interventions – Mahama
President John Dramani Mahama has confirmed that the Bank of Ghana (BoG) has suspended its interventions in the foreign exchange market, allowing the cedi to adjust freely and exposing both the currency’s underlying strength and vulnerabilities.
Speaking at his maiden media encounter on Wednesday, 10th September, President Mahama explained that the withdrawal followed a period of rapid cedi appreciation, which had triggered a surge in imports.
“Because of the rapid appreciation in the value of the cedi, we saw an exponential increase in imports. People could buy cheaper dollars and so they could import more, which is a natural economic phenomenon. But on the other side, exporters were not happy because they received fewer cedis for what they export,” he said.
The President stressed the need to balance the interests of importers and exporters, noting that policymakers must target a manageable depreciation of no more than 5 per cent per annum to maintain economic stability.
“The cedi is making an adjustment, and I believe it will settle at a certain rate. We will make sure that any depreciation that occurs is within a margin of about 5 per cent per annum. That is what we target,” he noted.
President Mahama recalled that the cedi’s sharp swings had unsettled markets and discouraged diaspora remittances.
“When you have steep depreciation like we had in 2024, with 25 per cent in the first half of the year, it makes planning difficult. We also saw a 50 per cent reduction in remittances because citizens in the diaspora were taken aback by the rapid appreciation of the cedi,” he noted.
The President revealed that investigations had uncovered serious irregularities in foreign exchange transactions.
“Some money transfer companies were collecting dollars abroad and not repatriating them. Others applied through commercial banks for foreign exchange to cover imports, but the imports never came into Ghana,” he stated.
President Mahama disclosed that over a four-year period, about USD42 billion left the country without corresponding imports, prompting sanctions on some banks and planned probes of individuals involved.
