Bank of Ghana Mops Up GH¢17.2bn to Tackle Inflation, Stabilize Cedi

The Bank of Ghana absorbed GH¢17.24 billion from the banking system through a sale of 14-day bills, signalling its determination to keep liquidity conditions tight as policymakers seek to consolidate gains in inflation and currency stability.

The operation, one of the central bank’s largest recent liquidity-management exercises, comes as authorities balance inflation pressures with the need to prevent excess cash from fuelling foreign-exchange demand and renewed price pressures.

Per the Notice to Banks and the Public No. 865, the June 8, 2026 auction attracted total allotments of GH¢17.24 billion, with bid rates ranging between 10.46% and 10.95%.

The weighted average interest rate settled at 10.98%, reflecting prevailing short-term liquidity conditions in the money market.

The latest operation highlights the central bank’s active use of open market instruments to absorb surplus liquidity from the banking sector at a time when preserving gains in inflation moderation, exchange rate stability and broader economic recovery remains a key policy priority.

Unlike Treasury bills, Bank of Ghana bills are primarily designed as monetary policy tools rather than instruments for government financing.

By reducing the volume of excess funds circulating within the financial system, the central bank aims to contain inflationary pressures, curb speculative demand for foreign exchange and keep short-term interest rates aligned with its policy objectives.

The sizeable auction also signals BoG’s determination to maintain tight oversight of liquidity conditions amid evolving market dynamics.

For financial institutions, the 14-day bill continues to provide a short-term investment avenue, while enabling the central bank to manage liquidity without increasing public borrowing.

The challenge going forward will be balancing liquidity absorption with the need to support private sector credit growth and economic expansion.

Source: CNR

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