Surge in high-value notes sparks inflation fears
By: Rebecca Okine
Ghana’s financial landscape experienced a shift in 2024, with the money supply increasing by over 60 percent, reaching GHS71.6 billion—a record that is stirring fresh debate over inflation risks and monetary policy direction.
The Bank of Ghana’s latest 2024 financial statement points to an unusual concentration of growth in high-denomination notes. The GHS200 note nearly doubled in circulation, rising from GHS12.3 billion in 2023 to GHS24.3 billion in 2024. Similarly, the GHS100 note climbed to GHS18.5 billion. In contrast, the GHS20 note remained flat at GHS5 billion, highlighting a shift toward larger-value transactions in the economy.
This rapid monetary expansion has come at a notable cost. Currency issuance expenses surged to GHS1 billion, up from GHS688 million the year before. Printing and minting costs also approached GHS1 billion, and foreign currency importation rose more than fivefold to GHS14.4 million as demand for foreign exchange intensified among banks and businesses.
The Bank of Ghana has yet to explain the underlying drivers of this monetary surge, leaving analysts and investors to speculate on whether it signals real economic expansion, government-led liquidity injections, or structural shifts in the financial system.
With inflation still a concern despite its decline since the beginning of the year, the pace and nature of this money supply growth are likely to remain in focus as policymakers weigh the trade-offs between economic support and price stability.
