The Bank of Ghana (BoG) has announced that it will commence foreign exchange (FX) intermediation under its Domestic Gold Purchase Programme (DGPP) from October 2025, marking a significant step in efforts to enhance market transparency, strengthen price discovery, and improve liquidity in Ghana’s foreign exchange market.
According to the Central Bank, the initiative will involve the sale of up to $1.15 billion in FX over the course of the month through twice-weekly, price-competitive spot auctions open to all licensed banks. The BoG emphasised that allocations will be made without preferential treatment or special conditions, ensuring a level playing field across the interbank market.
In a statement, the Bank explained that the new mechanism aims to deepen the interbank FX market, allowing for more transparent pricing and reducing excessive volatility that has characterised the cedi’s exchange rate performance in recent years. By linking the programme to domestic gold purchases, the BoG intends to leverage Ghana’s gold reserves to enhance FX supply and stabilise the local currency.
The Bank noted that monthly auction volumes could be adjusted in response to evolving market conditions, including liquidity levels and demand for foreign currency. However, it reaffirmed its commitment to transparency and accountability, pledging to publish the outcomes of all FX operations as part of ongoing efforts to build confidence among market participants.
Analysts view the initiative as a strategic extension of the BoG’s Domestic Gold Purchase Programme, which was launched in 2021 to harness Ghana’s position as Africa’s largest gold producer for FX stability and reserve accumulation. Under the programme, the Central Bank purchases gold domestically in cedis from small-scale and large-scale miners, building a reserve buffer that can be used to support the national currency and reduce reliance on external borrowing.
By using the gold-backed programme as a foundation for FX intermediation, the BoG is expected to improve the efficiency and transparency of currency allocation, while also promoting a more market-driven exchange rate system. The move could also help narrow the gap between official and parallel market rates, a persistent challenge in Ghana’s FX landscape.
Economists suggest that the measure forms part of a broader reform package aimed at bolstering Ghana’s FX management framework and restoring macroeconomic stability after years of currency weakness and external imbalances. The BoG has been implementing a mix of monetary tightening, gold-for-oil transactions, and reserve-building strategies to strengthen the cedi and contain inflationary pressures.
If successfully executed, the new FX auction system could enhance price discovery, reduce speculative pressures, and support investor confidence in Ghana’s financial markets. However, its long-term impact will depend on the central bank’s consistency in policy execution and the ability of the domestic gold purchase initiative to sustain FX inflows amid fluctuating global gold prices.
