BoG Flags Sustainability Concerns over Domestic Gold Purchase Programme
By Praisebell Rosemond Larbi
The Bank of Ghana (BoG) has signalled a possible recalibration of its Domestic Gold Purchase Programme, even as it reaffirmed the initiative’s importance to macroeconomic stability, reserve accumulation, and exchange rate support.
Opening the 128th Monetary Policy Committee (MPC) meeting, Governor Dr. Johnson Pandit Asiama said the programme has played a deliberate and strategic role in strengthening Ghana’s external buffers, but cautioned that its continued deployment must now be evaluated more carefully in light of sustainability and balance sheet considerations.
“The role of the Domestic Gold Purchase Programme in supporting stability remains critical. While the programme has played an important and deliberate role in strengthening external buffers, members will need to consider how its timing, sustainability, and balance-sheet implications should inform the calibration of policy and the ongoing policies to build reserves,” the Governor stated.
The comments indicate that while the central bank is not retreating from the gold purchase strategy, it is increasingly mindful of the potential long-term implications for its balance sheet and the broader conduct of monetary policy. The focus, according to Dr. Asiama, is to ensure that reserve-building efforts remain consistent with inflation management, policy credibility, and Ghana’s external financing framework.
The Domestic Gold Purchase Programme has been a central pillar of Ghana’s recent macroeconomic stabilisation efforts. Introduced to reduce reliance on foreign currency inflows and strengthen reserve buffers, the programme enabled the central bank to purchase domestically produced gold and add it to international reserves. Combined with favourable global gold prices, the initiative contributed significantly to reserve accumulation and helped support cedi stability throughout 2025.
However, Dr. Asiama’s remarks suggest that the MPC is now assessing whether the scale, pace, and timing of gold purchases remain appropriate as economic conditions evolve. Key considerations include the impact of gold purchases on liquidity conditions, reserve adequacy targets, and the credibility of Ghana’s monetary policy framework, particularly under the IMF-supported programme.
Analysts say any adjustment to the programme will be closely scrutinised by markets, given its role in stabilising foreign exchange liquidity and supporting investor confidence. A more measured approach, they note, could help balance the benefits of reserve accumulation against potential risks to the central bank’s balance sheet and inflation outlook.
With Ghana entering 2026 amid improving macroeconomic indicators but lingering external risks, the Domestic Gold Purchase Programme is expected to remain an important policy tool. However, the MPC’s deliberations suggest that its future use will be more tightly aligned with broader monetary and reserve management objectives, reinforcing the Bank of Ghana’s emphasis on policy discipline and long-term stability.
