ACCRA, Sept 29 (AGCNewsNet) - With less than a week before the International Monetary Fund (IMF) completes its 3rd review of Ghana’s ongoing economic program, authorities are scrambling to showcase their commitment to structural reforms.

Two recent developments from the Bank of Ghana (BoG) focus on addressing persistent challenges in the foreign exchange market, particularly the widening gap between official exchange rates and those on the open market.

The first announcement involved an update to how the BoG calculates the “reference rate” for forex transactions in the country. The BoG now plans to include all forex dealings between banks and between banks and customers involving transactions above $10,000. The main change in this revamped model is the extension of the transaction cut-off time from 2:00 PM to 3:30 PM.

While this adjustment is relatively minor, the BoG is likely pushing it as a significant improvement to address a deeper issue: the growing divergence between official exchange rates and those seen in real market conditions. On the surface, the daily weighted median rate published by the BoG—currently close to Bloomberg’s rate—has veered sharply from what the average Ghanaian encounters at forex bureaus. For example, while the BoG listed the USD-GHS selling rate at 15.83 on Thursday, market research showed forex bureaus selling at above 16.7, with banks quoting nearly 16 and fintech services over 17.

Such discrepancies are a concern for the IMF, as they suggest underlying inefficiencies in Ghana’s forex market and complicate monetary policy efforts.

In a second announcement, the BoG introduced a gold coin investment product to offer Ghanaians an alternative to dollar savings. While promoting gold as a hedge against the Ghana cedi’s persistent depreciation appears rational, questions remain regarding its feasibility and scale. Ghana’s volatile gold prices complicate its appeal, and convincing a large portion of investors to pivot to bullion from dollars may prove difficult.

History suggests the dollar has consistently gained value against the cedi since 1994, outperforming gold as a safe-haven asset. Between 2012 and 2015, for instance, investors who held gold made a nominal profit of around 72%, but dollar holders saw a return of roughly 140%.

Moreover, the BoG’s decision to prioritise gold for local investment may lead to missed opportunities to bolster its USD reserves through international gold sales. As the program scales, it could also cannibalise the treasury bill market rather than meaningfully curb dollar demand. In the most recent treasury bill auction, the government experienced an undersubscription rate exceeding 40%, a situation that could worsen if the gold coin initiative gains traction.

Both moves come at a crucial time for Ghana, as the IMF’s assessment will be key to unlocking further support for the struggling economy.