Amid the losses the Bank of Ghana (BoG) incurred in its Domestic Gold Purchase Programme (DGPP), the IMF has issued a caution to the government and the Central Bank to take measures to protect the bank’s balance sheet.
The IMF believes that there are growing fiscal and financial risks associated with DGPP, cautioning that quasi-fiscal activities tied to the initiative are weakening the central bank’s balance sheet and undermining confidence in monetary policy.
In its End-of-Mission statement following the sixth Staff-Level Review of Ghana’s $3 billion Extended Credit Facility (ECF) programme, the IMF stressed that maintaining a “forward-looking, prudent monetary policy” remains critical to anchoring inflation expectations and restoring macroeconomic stability.
However, beneath the caution lies a deeper concern of whether the central bank is drifting too far from its core mandate of price and financial stability into costly commercial-style operations that expose it to financial losses.
The Numbers
It is through the DGPP programme that the BoG is building gold reserves and forex reserves to cushion the economy. However, the Central Bank has been reporting consistent losses on its balance sheet for years under the programme.
For instance, the BoG reported net losses of over GH¢7.1 billion between 2022 and 2024. This breaks down to GH¢74.44 million in 2022, GH¢1.37 billion in 2023, and GH¢5.66 billion in 2024.
The trend repeated itself in the 2025 financial year: The bank’s 2025 Audited Financial Report revealed that the losses from the programme increased to GH¢9.05 billion.
The IMF’s Worry
While the initiative has been praised by some economists and analysts as innovative and patriotic, the Fund appears worried that the central bank may be carrying fiscal burdens that properly belong to the government.
In practical terms, the IMF is essentially cautioning that when a central bank starts acting too much like a trader, commodity dealer, or fiscal agent without adequate safeguards, the financial consequences can come back to weaken the institution responsible for keeping inflation under control.
That concern is particularly important for Ghana at a time when confidence in economic management, though improving, remains fragile after years of high inflation, debt restructuring, and currency instability.
The Call to Rebuild BoG Balance from Losses
The Fund emphasized that efforts to strengthen monetary policy transmission and credibility should include protecting and rebuilding the Bank of Ghana’s balance sheet. According to the IMF, increased transparency around the DGPP and tighter limits on quasi-fiscal operations are necessary to prevent hidden financial pressures from accumulating within the central bank.
Experts describe quasi-fiscal activities as operations carried out outside the national budget but which still create fiscal costs or contingent liabilities for the state.
In Ghana’s case, the IMF appears to be signaling that losses linked to gold purchases, exchange rate movements, financing costs, or operational inefficiencies could eventually become a burden on taxpayers if not properly recognized and managed. The Fund therefore wants future DGPP-related costs to be transparently reflected in the national budget rather than being absorbed quietly through the central bank’s books.
“The losses associated with the Domestic Gold Purchase Programme (DGPP) underscore the importance of increasing transparency and limiting quasi-fiscal activities that weaken the central bank’s balance sheet. Efforts to protect the Bank of Ghana’s balance sheet from DGPP-related quasi-fiscal risks and budget recognition of future costs would help enhance accountability and oversight,” the IMF noted in its report.
The Bottomline
The Bretton Woods institutions’ warning revives the old but critical debate in economic governance on how far a central bank should go in directly supporting government economic objectives before it begins compromising its own independence and financial health.
For many, the issue is not necessarily whether the DGPP is entirely wrong, but whether the scale, structure, and risk management arrangements are sustainable for a central bank already recovering from significant losses incurred during Ghana’s domestic debt restructuring programme.
