BoG purchases 600 kilogrammes of gold to boost reserves

The Bank of Ghana (BoG) has purchased 600 kilogrammes of gold under its Domestic Gold Purchase (DGP) programme to help shore up the country’s foreign exchange reserves, Governor, Dr Ernest Addison, has said.

He disclosed this on Monday after the 105^th regular meeting of the Monetary Policy Committee press conference, in response to a question on the quantity of gold the BoG has purchased under the DGP programme.

BoG in June last year launched the DGP to augment our foreign reserves with a view to doubling gold holdings in our foreign exchange reserves portfolio.

Gross International Reserves at the end of February 2022 stood at US$9,547.96 million, providing cover for 4.3 months of imports of goods and services, which compared well with US$9,695.22 million, equivalent to 4.4 months of import cover at end December 2021.

Among the objective of the programme was to help the BoG to grow its foreign exchange reserves to foster confidence, enhance currency stability, and create a more attractive environment for foreign direct investments and economic growth.

 “The DGP programme is doing well,”Dr Addison said.

He said the BoG would in the next two months send the gold abroad to be refined into pure gold by a company certified by the LMBA.

Quizzed why the gold was not refined in Ghana, Dr Addison said the Precious Minerals and Marketing Company did not have the LBMA certificate.

The LBMA is an independent precious metal authority which advances standards for the common good of the global industry.

Dr Addison said government was working for the country to get LBMA certificate to refine gold locally.

The Governor said the DGP programme would also enable the bank to leverage its gold holdings to raise cheaper sources of financing to provide short term foreign exchange liquidity.

He indicated the programme would assist the BoG to diversify its revenue base and provide numerous funding opportunities for the bank.

The Governor emphasised the objective of BoG was to increase its current gold holdings to 8.7 tonnes by 2026 in a bid to bring its total gold reserves to 17.4 tonnes.

Source: Ghanaian Times