Bank of Ghana assures universal banks of having enough dollars to stabilise the cedi following the issuance of the new GH¢100 and GH¢200 notes

The Bank of Ghana (BoG) has urged universal banks in the country that it has adequate dollars to stabilise the cedi following the issuance of the new GH¢100 and GH¢200 notes.

Dr Ernest Addison, Bank of Ghana Governor

This was captured in a circular issued to all commercial banks in the country.

According to report, the circular is a fresh move by the BoG to manage market sentiments because of

its impact on the Ghana Cedi.

Why the move

The regulator believes the current pressure on the cedi is not backed by real demand but fears that the local currency position could worsen very soon.

The central bank's reserve is said to be more than 8 billion dollars for this month, however, despite this strong position, the pressure on the Ghana Cedi reaches high levels

The Ghana Cedi is currently trading against the dollar at GHC5.57075, this could get worse because businesses will seek more dollars to finance their imports this period.

The Central Bank has however maintained that building up the required dollar reserve is needed to up the support required to slow the cedi's rate of depreciation, the Central Bank said they are working to align its forex rate to that of the market.

This will help address the disparity in the regulator's rate and what the commercial banks are offering to the public and this will help firmly stabilise the Ghana cedi against the dollar.