The dollar has begun a steady rise over the cedi in the last few weeks prompting fear the country is heading back to the dark days of 2022 when the cedi depreciated.

The Bank of Ghana is today quoting the exchange rate at ¢10.30 to the dollar but the rate is slightly higher in the commercial space with some quoting ¢12.50.

But despite the rise, the Governor of the central bank Dr Ernest Addision is confident the worst days of the cedi are over.

According to him, the poor performance of the currency in 2022 will not repeat itself.

This, he said can be made possible if the debt exchange programme is successful.

“Government has announced a debt stand still and that debt standstill means that the outflows – the money used to service foreign debt will not go out anymore.

"That gives us a lot of room and takes pressure on the foreign exchange market. So because of that debt standstill, I can say that we should expect the currency to remain relatively stable.

"I can stake my neck out that we will not see the sort of things we saw in 2022 if everything works well,” he said.

Responding to questions at the parliament public accounts committee, Dr Addision, however, admits the country does not have enough foreign reserves with import cover currently lasting only a month and a half.

“It depends on what transactions have taken place that week, maybe there have been payments to contractors, typically, those types of payment can move the exchange rate immediately and convert that into the foreign exchange – it could be payment for energy, for the energy sector a lot of payments are outflows they impact on the foreign exchange market so the exchange rate really reflects a lot of the day to day pressures of the economy,” he explained.

In a related development, the bank is confident it will be able to sustain the Gold for Oil deal.

The Central Bank says the country has a sufficient quantity of gold reserves to sustain the policy. 

The Director of Financial Market at the Bank of Ghana, Stephen Opata made this known on Monday, January 16, when he appeared before the Public Accounts Committee (PAC).

According to him, there is no cause for concern as the Central Bank is well-positioned to meet the demand for 160,000 ounces of gold per month under the deal.

“As for the quantities, based on the production numbers we saw last year, gold has picked up. We believe that we can buy enough gold to sustain the program. 

“I must say that the numbers we are currently looking at is about 160,000 ounces per month and that will represent about 50 to 60 per cent of the consumption of the country. According to what PMMC indicates, I think we have volumes to support the programme,” Mr Opata said. 

The first consignment of oil under the policy arrived at the Tema Port on Monday. 

The 40,000 metric tons of oil from the United Arab Emirates was subsequently discharged to Bulk Oil Storage and Transportation (BOST).

BOST will subsequently formulate plans for its distribution and sale to the Oil Marketing Companies. 

Commenting on the arrival of the first consignment, the Governor of the Bank of Ghana said the development has reduced pressure on the foreign market.

“If this government-to-government arrangement works well, we will not be adding pressures to the exchange market.”