The Bank of Ghana (BoG) says the reduction reflects a strategic rebalancing of its portfolio, arguing that the proceeds are now generating returns through foreign‑exchange assets and stressing that plans are in place to rebuild the stock of gold over time.
BoG Governor Dr Johnson Asiama maintains that the move aligns Ghana with what he describes as its “peers”, though he has not clarified which countries this comparison refers to, whether by gross domestic product size, regional grouping or income classification.
However, the decision has raised alarms among economists, including Dr Frank Bannor, Development Economist and Senior Research Fellow at the Institute of Economic Research and Public Policy. He argues that the sharp drop in reserves warrants a detailed explanation, given years of deliberate efforts to accumulate gold as a buffer against economic shocks.
Ghana’s push to build its gold reserves intensified after the global economic turmoil triggered by Russia’s invasion of Ukraine in 2022. The conflict contributed to Ghana’s inflation surging to over 54%, while the cedi depreciated sharply against major currencies such as the United States (US) Dollar and Euro.
To protect the economy from similar external shocks, the previous administration launched the Domestic Gold Purchasing Programme, aimed at increasing reserves and helping stabilise the currency. Prior to this initiative, Ghana had accumulated just 8.7 tonnes of gold between independence in 1957 and 2022.
By contrast, between 2022 and 2024, reserves climbed dramatically to 30.53 tonnes, representing around 52% of the country’s total reserve holdings. The new administration, which took office in January 2025, added further to this stock, boosting total reserves to 38 tonnes by October 2025, a development widely applauded.
However, the BoG’s latest report, covering the end of the 2025 fiscal year, revealed that gold holdings had fallen to 18.6 tonnes, prompting fresh questions from analysts, civil society groups and market observers.
Bannor argues that reducing gold holdings at a time of soaring global gold prices, above $5,000 per ounce, is particularly problematic. He notes that central banks worldwide have been increasing their gold purchases as a safeguard against currency volatility and weakening confidence in the US Dollar.
“Gold is now seen as a more reliable store of value than the dollar, given recent volatility,” he said. “Global financial experts are advising central banks to increase, not reduce, their gold exposure.” He also criticised the lack of clarity around the BoG’s justification:
“If the Bank of Ghana says it is aligning Ghana with its ‘peers’, then it must explain who these peers are. Without transparency, such decisions risk undermining market confidence.”
Economists warn that the central bank’s credibility is crucial to effective monetary policy. Bannor argues that the BoG must urgently communicate the reasons behind the liquidation and outline a roadmap for restoring the reserves to at least the levels inherited in early 2025.
“A central bank must inspire confidence among investors and citizens,” he said. “Ghanaians need clarity on why reserves were converted into hard currency and how the Bank plans to rebuild the stock. Only the Governor of the BoG can provide these answers.”
–ChannelAfrica–
