BY Grace Zigah
The Bank of Ghana has defended its historic 300-basis points policy rate cut to 25 percent, stressing that the move was data-driven and reflects the strong performance of the external sector and rapid disinflation over the past five months.
Speaking at the 125th Monetary Policy Committee (MPC) press briefing in Accra, Governor of the Bank of Ghana, Dr. Johnson Asiama explained that while the exchange rate of the Ghana cedi against the US dollar has raised public concern, the central bank is not defending any specific rate.
Ghana, he reiterated, operates a managed floating regime where the cedi is allowed to fluctuate according to economic fundamentals.
“We do not maintain a fixed rate, nor do we peg or defend the cedi. The strength of the external sector shows there is no fundamental reason for the cedi to come under pressure,” the Governor told journalists.
Dollar Availability And Importer Concerns
The Governor addressed reports from importers about difficulties accessing foreign exchange at commercial banks.
He clarified that while isolated cases had been recorded, there was no systemic shortage of dollars in the financial system.
According to him, some delays in transactions were linked to importers failing to present the appropriate documentation.
He noted that the Bank of Ghana continues to supply foreign exchange almost daily, particularly as inflows from small-scale mining operations and gold purchases now accrue directly to the central bank.
The Bank has also issued new guidelines to Payment and Remittance Service Providers and Money Transfer Operators to improve monitoring of inflows and ensure all foreign exchange is accounted for within the domestic system.
Non-Performing Loans and Banking Sector
The Governor admitted that non-performing loans (NPLs) remain elevated at 23.1 percent, requiring strict regulatory supervision.
New notices have been issued to banks to strengthen credit administration frameworks, especially as the era of easy returns from government bills begins to wind down.
“Soon, banks will have to rely on the performance of their loan books rather than risk-free investments to remain profitable,” he warned, underscoring the need for prudent lending practices.
