The Bank of Ghana’s decision to begin foreign exchange (FX) interventions this October through its Domestic Gold Purchase Programme (DGPP) comes at an exceptionally timely moment.
With gold prices soaring past $4,000 per ounce for the first time in history, the central bank stands to benefit from a stronger reserve position and potentially higher exchange earnings as it rolls out its gold-backed FX operations.
The DGPP, introduced to strengthen Ghana’s reserve buffers and reduce reliance on external FX inflows, allows the central bank to purchase locally mined gold in cedis and use those holdings to support foreign exchange needs.
Starting this month, the Bank plans to sell up to US$1.15 billion on the interbank market through twice-weekly, price-competitive auctions. The move is expected to improve FX liquidity, enhance price discovery, and stabilize the cedi against major currencies.
Adding to this is the role of the Gold Board and the structured gold purchasing framework, which now channels a larger share of the country’s gold production through formal domestic systems. By tightening oversight and offering competitive local pricing, the framework captures volumes that might otherwise have been exported or traded informally, ensuring that more gold passes through official channels to support the nation’s reserves and foreign exchange management.
The launch coincides with an extraordinary rally in global gold prices. On October 8, 2025, spot gold traded at US$4,036.98 per troy ounce, up 1.28% from the previous day and 54.77% higher than a year earlier, according to market data. Gold reached an all-time high of US$4,049.52 this month, driven by strong investor demand amid global economic uncertainty, a weaker U.S. dollar, and continued geopolitical tensions.
This price surge directly benefits Ghana, one of Africa’s leading gold producers. The higher valuation of gold increases the dollar equivalent of the BoG’s gold reserves, effectively enhancing the central bank’s balance sheet and improving the potential returns from its gold-backed FX operations.
The result is a stronger capacity to intervene in the market and a potential lift in exchange earnings at a critical point in Ghana’s economic recovery.
The impact extends beyond the central bank. Local gold producers participating in the DGPP are expected to gain from better pricing, increasing export receipts and stimulating activity in the small-scale mining sector.
These developments could help sustain Ghana’s recent trade performance, with a US$6.2 billion trade surplus recorded in the first eight months of 2025, and further support foreign reserves, which now stand at US$10.7 billion, or 4.5 months of import cover.
The combination of a stronger reserve base, steady FX inflows, and easing inflation provides an encouraging backdrop for economic stability.
For now, the convergence of record-high gold prices and the start of BoG’s FX interventions presents a rare alignment of timing and opportunity.
