Sale of Gold Saves Bank of Ghana From a Higher Loss
- The Bank of Ghana avoided a GH¢33 billion loss through strategic gold sales amid tight monetary policies
- The Domestic Gold Purchase Programme strengthened its reserves and stabilised Ghana's foreign exchange market
- Since its implementation, the DGPP has helped build foreign exchange buffers without heavy reliance on the currency market
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The Bank of Ghana would have ended 2025 with a loss of almost GH¢33.2 billion, which would have been over double the GH¢15.63 billion it actually reported if it had not sold refined gold accumulated mainly from the purchases made in 2023 and 2024 under the central bank's Domestic Gold Purchase Programme (DGPP).
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The BoG attributed the surge in gold-related income and improved reserve management to a stronger policy solvency position in 2025, even though it recorded a loss.
BoG recorded an operating loss of GH¢15.63 billion for the 2025 financial year. However, a closer look at its report showed that without a GH¢9.57 billion gain from refined gold sales, the loss would have been worse.
The gap underscores the underlying cost of anchoring the cedi and reining in inflation through tight monetary policy and elevated interest rates.
If the BoG had not sold the gold, its ability to fund monetary operations would have been almost impossible.
“The Domestic Gold Purchase Programme has contributed meaningfully to the stabilisation of Ghana’s foreign exchange market by strengthening reserve buffers and reducing structural pressures on foreign currency demand. Through the domestic acquisition of gold, the Programme has enabled the Bank to augment foreign exchange reserves without recourse to the domestic foreign exchange market, thereby easing pressure on the cedi,” the BoG’s Directors stated in their report to the Finance Minister.
About the Domestic Gold Purchase Programme
The Domestic Gold Purchase Programme was launched in June 2021 to help the BoG strengthen its reserve and reduce exposure to external shocks.
Ghana is not the only country practising such. Central Banks across the world have turned to gold for similar reasons as the BoG since the global financial crisis.
In Ghana, the DGPP was launched to rebuild depleted reserves, ease exchange-rate pressures, and restore investor confidence.
The BoG is expected to source gold from several channels: purchase refined gold from mining companies for direct inclusion in reserves; acquire dore gold from aggregators for refining into monetary gold; and buy gold from small-scale miners through the Ghana Gold Board for export to generate foreign-exchange liquidity.
This approach enables the Bank to accumulate reserves while generating income and maintaining flexibility in market interventions.
Since its implementation, the DGPP has helped build foreign exchange buffers without heavy reliance on the currency market, easing pressure on the cedi.
“Furthermore, the Programme has materially advanced reserve diversification, reduced dependence on other foreign currency-denominated assets, and bolstered confidence in the Bank’s external position and overall policy framework. Taken together, these outcomes have contributed to moderating exchange rate volatility and reinforcing stability in the foreign exchange market,” the Directors concluded.
Source: YEN.com.gh
