The Governor of Bank of Ghana (BoG), Dr Ernest Addison, disclosed this in Accra yesterday after the 118th regular meeting of the Monetary Policy Committee of the BoG, and urged those engaged in the specu­lative purchases of dollars to stop from the practice, saying the BoG remained fully committed to provide stability in the exchange rate for the cedi.

The Committee yesterday maintained the policy rate un­changed at 29 per cent over con­cerns in uncertainties in the global and domestic economies.

He said the bank had enough foreign exchange reserves to support the market and economic agents should stop engaging in speculative purchases as they would suffer economic losses when the correction occurs.

“The Bank of Ghana has adequate reserves to manage these shocks to the foreign exchange market, having added over $600.0 million to the current foreign exchange reserve levels over the first five months of the year. The improved reserves position is also backed by strong liquid monetary gold levels of over 26.6 tonnes (estimated at US$2.1 billion) as a result of the very successful domes­tic gold purchase programme,” the Governor stated.

Dr Addison, who is also the chairman of the MPC, said the exchange rate pressures witnessed in recent weeks reflected a weakening of the current account surplus due to higher import demand and lower export revenue, especially a sharp fall in cocoa export earnings.

He said the foreign exchange market pressures also reflected robust public spending on Inde­pendent Power Producers arrears payment, and capital expenditure outlays.

Dr Addison said there were also indications of increased pressures from importers diverting foreign exchange demand requirements into informal markets, increasing specu­lative demand for foreign exchange.

Dr Addison said the BoG was taking measures to improve market conduct and instil sanity in the mar­ket for foreign exchange.

To this end, he said the bank had worked with the Ghana Associ­ation of Banks to streamline docu­mentation requirements for foreign payments tominimise the incentives to resort to the informal markets.

“To deal with the high demand pressures on the foreign exchange market, the bank has taken steps in the past few weeks to directly absorb foreign exchange needs of

 some corporate institutions, and this has led to a reduced pipeline demand for foreign exchange from the commercial banks,” Dr Addison stated.

The Governor said the BoG was fully aware of the operations of illegal operators in the foreign exchange market and was working with the Financial Intelligence Cen­tre to sanitise the foreign exchange market, adding that the foreign exchange bureau monitoring would step up to ensure compliance with their regulatory framework.

“In line with this, all foreign exchange bureaus advertising rates outside their premises and on social media platforms must immediately desist from the practice. The bank has set up a task force to monitor all the foreign exchange bureaus to ensure compliance. The foreign exchange market is also affected by sentiments and pronouncements made in this election year and we urge all to manage pronouncements which weaken confidence in the local economy,” Dr Addison stated.