The Bank of Ghana (BoG) has announced the launch of its first-ever gold coin, the Ghana Gold Coin (GGC), aimed at addressing the persistent depreciation of the cedi and high inflation rates. The GGC, set to be released in two weeks, was unveiled by Governor Dr. Ernest Addison during a press briefing on September 27, 2024. This initiative marks a significant shift in the central bank's strategy to diversify investment options and stabilize the economy.
The GGC will be available in three sizes: 1 oz, ½ oz, and ¼ oz, and is produced from gold refined to 99.99% purity. Each coin will feature the Ghana Coat of Arms and the Independence Arch, symbolizing national pride. While some analysts express skepticism regarding the coin's long-term effectiveness in stabilizing the cedi, it represents a novel approach in Ghana's financial landscape.
Dr. Addison emphasized that the GGC will help the BoG manage liquidity in the banking sector, complementing existing monetary policy tools. The coin's pricing will be based on the previous day's London Bullion Marketing Association auction price, and transactions will occur through commercial banks in cedis, with a minimum purchase requirement of about GH¢10,000.
This initiative builds on the success of the Domestic Gold Purchase Programme, which has significantly bolstered Ghana's gold reserves, now valued at approximately US$5.07 billion. Despite the positive trends in reserve accumulation, the cedi's depreciation remains a challenge, having fallen by 24.3% against the U.S. dollar since the start of the year.
Market analysts remain cautious about the GGC's potential to address structural issues affecting the cedi, suggesting that a more comprehensive approach is needed. While the GGC offers a new investment avenue and aims to reduce reliance on foreign currencies, its long-term impact on inflation and currency stability remains to be seen.