The Governor of the Bank of Ghana says the central bank is not targeting a fixed exchange rate for the cedi, but is instead focused on strengthening buffers to support stability under a managed float system.
Speaking at the 130th Monetary Policy Committee (MPC) press briefing, he explained that movements in the exchange rate are expected, but do not necessarily signal economic distress.
“The good part of it all is that we have buffers. We are building them on a daily basis,” he said, noting that reserve accumulation continues alongside improvements in the country’s trade account.
He added that temporary declines in buffers should not be misinterpreted as a setback for the economy, stressing that the central bank’s broader position remains intact.
“At times you might see the buffers a little down, it doesn’t mean anything has gone wrong,” he stated.
According to him, the key objective is to maintain sufficient reserves that can absorb shocks while allowing the currency to respond to market forces. He stressed that as long as these buffers continue to build, the cedi should be allowed to move within its natural range.
“So long as we have the buffers and continue to add to them, it doesn’t matter — let the cedi float, let it move,” he said.
He further indicated that the Bank of Ghana’s focus is not to eliminate exchange rate movements but to prevent extreme instability reminiscent of previous periods, when sharp volatility created economic uncertainty.
“What we will ensure is that we will not see a return to the kind of volatility we saw in previous years,” he said.
The Governor’s comments come amid recent discussions about slight depreciation pressures on the cedi in recent months, with policymakers maintaining that the currency remains broadly guided by underlying market fundamentals.
