Bank of Ghana to Sell $120 Million to Bulk Oil Distribution Companies in Third Quarter 2023

The Bank of Ghana would sell $120 million to Bulk Oil Distribution Companies (BDCs) in the third quarter of 2023.

This will be done via the FX Forward Auction Calendar for the third quarter of 2023.

According to the calendar, $40 million each would be auctioned in July 2023, August 2023 and September 2023 respectively.

$20 million each will be sold on July 14 and 28, 2023 respectively.

Another $40 million dollars will be sold in August 2023. $20 million each would be sold on August 15 and August 30, 2023, respectively.

The Central Bank will once more sell $40 million in September 2023 ($20 million on September 14 and $20 million on September 29, 2023).

The FX support to the BDCs is expected to reduce the dollar liquidity constraints the oil importers go through, a move that will help boost the supply of petroleum products and stabilize prices at the pumps.

According to the BoG, the BDCs Forex Forward Auction will be governed by the guidelines published and available on its website.

In accordance with the BDCs Forex Forward Auction guidelines, bids are invited as per the prescribed format to purchase United States Dollars against Ghana cedis, separately on each auction date and should be submitted via the dedicated email bogforwards@bog.gov.gh.

The International Monetary Fund (IMF) had earlier in its Country Report on Ghana advised the Central Bank to take steps to suspend the programme.

The IMF’s position was as a result of concerns over the emergence of multiple exchange rates caused by the BoG’s occasional provision of forex support at rates differing from those prevailing in the market.

The Fund therefore expects the BoG to ensure that its forex liquidity is provided at market exchange rates, while also implementing measures to support the unification of exchange rates across the board.