The Bank of Ghana’s efforts to control inflation and stabilise the cedi are significantly contributing to its growing financial losses, according to a new report by the Centre for Economic Research and Policy Analysis (CERPA).
The think tank said the central bank’s use of tight monetary policies including high interest rates and liquidity control measures has come with “substantial financial costs” that are worsening its balance sheet.
In its latest policy brief, CERPA explained that although these measures have helped contain inflation and ease exchange rate pressures, they have also increased the Bank of Ghana’s operational losses.
“To manage inflation and exchange rate pressures, the Bank of Ghana has relied heavily on open market operations, central bank bills, and high policy rate transmission,” the report stated.
The findings come amid growing concerns over the financial condition of the central bank following reports of heavy losses linked to recent economic stabilisation measures.
CERPA noted that the current high-interest-rate environment has made it more expensive for the central bank to absorb excess liquidity from the financial system.
These measures, aimed at controlling money supply and reducing inflation, now carry higher costs because interest rates remain elevated.
The report also pointed to the weakening cedi as another major challenge.
According to CERPA, the depreciation of the local currency increases the domestic value of the Bank of Ghana’s foreign liabilities, leading to additional losses.
“Depreciation of the Ghanaian cedi increases the domestic currency value of foreign liabilities,” the brief stated, adding that exchange rate volatility in 2025 likely worsened the central bank’s external position.
CERPA said the situation highlights a difficult balancing act for policymakers.
While tight monetary policies are needed to control inflation and rebuild confidence in the economy, they are also placing more financial pressure on the central bank.
“This trade-off must be managed carefully to avoid undermining confidence in monetary policy,” the think tank warned.
The report also raised concerns about quasi-fiscal programmes such as Gold-for-Oil and Gold-for-Reserves. CERPA argued that although these initiatives were introduced to stabilise fuel prices and support foreign exchange reserves, they go beyond the Bank of Ghana’s core responsibilities.
The think tank is therefore calling for a policy shift, recommending that the government gradually take over such non-core programmes.
It further urged the central bank to focus strictly on its main responsibility of maintaining price stability, warning that continued involvement in non-traditional operations could further weaken its financial position.
