The Bank of Ghana spent some GHC 17 billion in 2025 to help mop up excess liquidity on the market last year.

This represents an increase from the GHC 8.6 billion spent in 2024 as part of the Central Bank’s liquidity management operations.

The governor of the Bank of Ghana, Dr John Asiama, revealed this when he led a technical team from the Bank of Ghana to brief Parliament’s Committee on Economy and Development in Accra today on a detailed Monetary Policy Report.

The governor was, however, quick to add that "when the central bank absorbs excess liquidity from the banking system, it pays interest on the instruments used to temporarily hold those funds as interest rates remained elevated during the stabilisation period."

The governor went on to explain that “intensified open market operations were required to absorb excess liquidity, resulting in higher interest expenses during the period of tight monetary policy."

Dr Asiama, during the meeting with the committee, stressed that these numbers should be put in context and discussed in a way that allows the public to appreciate the financial implications of these stabilisation efforts for the Bank of Ghana.

“Central banks often incur financial costs when implementing policies necessary to restore macroeconomic stability,” he disclosed.

"The financial effects that will be reflected in the bank's accounts are the accounting counterpart of the stabilisation benefits now being realised across the Ghanaian economy," the governor stated.

Dr Asiama told the committee that lower inflation, exchange rate stability, and improved macroeconomic confidence have delivered significant benefits to households, businesses, and government.

"These outcomes were achieved through policy actions that inevitably carry financial consequences for the central bank," he added.

Dr Johnson Asiama assured members of the committee that “these financial outcomes do not affect the Bank of Ghana’s ability to conduct monetary policy or fulfil its mandate."

BoG’s Gold Purchase Programme

On the Gold Purchase Programme, the governor stated that the initiative involved operational costs. A significant component of these costs arises from the exchange rate differential embedded in the transaction process.

"Gold is purchased domestically at market exchange rates but recorded at the Bank of Ghana reference rate for accounting purposes, generating an accounting cost in the bank's financial statements."

Again, the governor stated that appreciation of the cedi during 2025 produced valuation effects on foreign currency assets, adding that "when the domestic currency strengthens, the cedi value of foreign-denominated assets declines, and this translation effect appears in the bank's accounts as an accounting valuation loss."

Strengthening Bank of Ghana’s financial position

The governor stated that several measures are expected to support a gradual strengthening of the bank's financial position over the medium term.

These include the bank's income position, which is expected to improve as its earning assets gradually reprice over time. He added that "as domestic securities and foreign reserve assets mature and are replaced, they will be reinvested at prevailing market yields. This natural portfolio turnover will support a gradual recovery in investment income."

Dr Asiama also stated that “Enhancements in reserve asset management are expected to support stronger investment income over time."

The governor also highlighted that cost pressures associated with liquidity management operations are expected to ease as macroeconomic conditions stabilise.

“As inflation declines and policy interest rates gradually normalise, the interest expense associated with absorbing excess liquidity in the banking system will also decline naturally," he added.

Dr Asiama also stated that the government has indicated plans to partner with the Bank of Ghana in carrying a portion of the associated costs going forward when it comes to the Domestic Gold Purchase Programme.

This is because the programme has evolved into an important national initiative supporting reserve accumulation and external stability.