Bank of Ghana Signals More Reforms to Boost Transparency and Stability in Forex Market

2 weeks ago

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The Bank of Ghana (BoG) has announced plans to roll out additional reforms aimed at strengthening transparency, discipline, and efficiency in the country’s foreign exchange (forex) market. Governor Dr. Johnson Asiama said the measures form part of a broader effort to stabilize the cedi and improve market confidence amid ongoing volatility and speculative trading pressures.

Speaking during a media engagement in Accra, Dr. Asiama emphasized that the central bank remains firm in its commitment to ensuring that forex operations are conducted with integrity and accountability. “We are introducing new frameworks that will make the market more transparent, predictable, and rules-based,” he said. “This is to ensure discipline and curb practices that distort the market or create artificial demand.”

While the Governor did not provide detailed timelines, sources within the Bank suggest that the upcoming reforms could include a more automated reporting system for forex transactions, stricter compliance monitoring for licensed dealers, and improved collaboration with law enforcement to curb black-market activities.

The foreign exchange market in Ghana has come under pressure in recent months due to fluctuating capital inflows, rising import demand, and external shocks such as global commodity price changes. These factors have occasionally triggered speculative trading, contributing to short-term cedi depreciation and price instability.

Bank of Ghana Signals More Reforms to Boost Transparency and Stability in Forex Market — The Bank Square

According to Dr. Asiama, the reforms will build on previous measures already introduced by the central bank, including the daily publication of interbank rates, tighter supervision of forex bureaus, and improved data reporting standards. He stressed that these steps are designed not only to enhance transparency but also to foster a stable environment for trade and investment. “Our goal is to make the forex market more reflective of real economic fundamentals rather than speculative pressures,” he explained.

Market analysts have welcomed the Bank’s announcement, saying that greater transparency could reduce uncertainty and improve investor confidence. Financial economist Dr. Patrick Ofori noted that consistent and open market communication helps limit rumors and misinformation that often lead to panic buying of foreign currency. “When market participants trust the data and process, they are less likely to engage in speculative behavior. That’s a win for both stability and long-term growth,” he said.

However, some industry observers caution that reforms alone may not be enough without broader fiscal discipline. Ghana’s foreign exchange challenges, they argue, are partly rooted in structural issues such as trade imbalances, heavy import dependency, and fluctuating foreign reserves. Economist and policy analyst, Dr. Esi Baidoo, pointed out that “while regulatory reforms will help, the real solution lies in diversifying exports, reducing external borrowing, and strengthening local production capacity.”

In recent months, the Bank of Ghana has intensified efforts to stabilize the cedi through targeted interventions and moral suasion. It has also tightened rules governing foreign exchange transfers and set limits on forex holdings by commercial banks. These measures, though occasionally criticized by traders for being restrictive, have helped reduce volatility in the short term.

The central bank’s renewed focus on market transparency comes at a time when Ghana’s economy is gradually recovering from the inflationary shocks of the past two years. Headline inflation, which had surged above 50% in 2023, has started to ease, while the cedi has shown marginal stability in the first half of 2025, supported by improved remittance inflows and donor support.

Dr. Asiama reaffirmed the Bank’s readiness to maintain a stable macroeconomic environment and protect the value of the cedi. “We will continue to monitor the forex market closely and take the necessary steps to ensure that it operates efficiently. Our responsibility is to promote price stability and ensure confidence in Ghana’s financial system,” he stated.

The planned reforms, once implemented, are expected to increase market visibility and reduce opportunities for manipulation. For Ghana’s business community, especially importers and exporters, this could mean more predictable exchange rates and better planning for transactions.

The Bank of Ghana’s proactive stance reflects growing recognition that transparent financial governance is key to sustainable growth. As global financial markets become increasingly complex, Ghana’s ability to maintain a disciplined and transparent forex system will be vital in safeguarding its economic resilience and investor credibility.