Compiled By: Prince Henry Danquah, Bora Capital Advisors Ltd.
The Bank of Ghana (BOG) Board has approved a new Foreign Exchange Operations (FX) Framework, designed to clarify the objectives and principles guiding the BOG’s FX operations.
This framework reinforces BOG’s commitment to maintaining macroeconomic stability under its inflation-targeting mandate and a flexible exchange rate regime, where the exchange rate remains market-determined.
Under the new framework, BOG’s FX operations will pursue three key objectives.
* First, the Bank will support reserve accumulation to provide a buffer against external vulnerabilities.
* Second, it will act to dampen excessive short-term volatility in the foreign exchange market, responding to disorderly conditions without undermining exchange rate flexibility.
* Third, BOG will intermediate FX flows in a market-neutral manner, using inflows from sources such as the Gold Purchase Programme, or other export surrender requirements.
Source: newsthemegh.com