BoG’s Proactive Gold Sale Shields Ghana from Falling Prices – Sammy Gyamfi
The Chief Executive Officer of the Ghana Gold Board (GoldBod), Sammy Gyamfi, has postulated that the country’s Central Bank made a prudent decision in converting about 22 tons of the country’s gold holdings into U.S dollars.
Reacting to the drop in global gold prices from a record-high of about $5,500/oz to about $4680/oz, he indicated that the decision by the Bank of Ghana (BoG) was a proactive step that has cushioned the country from the impact of the price reduction.
In a Facebok post, he questioned, “For those who have been unjustly attacking the Bank of Ghana for their decision to sell portions of the country’s gold holdings, as a deliberate reserve portfolio diversification measure, how do you feel about the free fall of gold prices we are currently witnessing, where the price of bullion in the last few weeks has dropped from a record-high of about $5,500/oz to about $4680/oz? “
He posited that despite its proven asset guarantee, the mineral is subject to significant price volatilities that pose considerable risk to reserve preservation.
“This is why a middle-income country like Ghana, with Gross International Reserves of barely 5.7 months, ought not to over-concentrate its reserves in gold holdings but rather, diversify them across different asset classes. In reserve portfolio management, safety and liquidity considerations are paramount,” he explained.
The decision by the Bank, he said, had saved the country from national asset loss and significantly minimised the impact of the gold price drop on Ghana’s reserve position.
He therefore judged that action by the Bank was prudent.
“Converting portions of our gold holdings into cash and investing the same to generate returns for the country, was therefore a SAFE and sensible decision by the BoG…Kudos, Dr Asiamah and your wonderful team at the BoG. Keep up the good work for Mother Ghana.”
Story by Hajara Fuseini
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