News Guide Africa

Tag: Ghana gold coin

  • Gold Coin Program coming back stronger

    Gold Coin Program coming back stronger

    The Ghana Gold Coin, which was officially introduced in 2024 as a new financial instrument to diversify investment options for the public, is set to be relaunched this month alongside the Cedi at 60 commemorative program launch, the Bank of Ghana has said.

    The coin, made from gold mined and minted in Ghana, has been refined to 99.99% purity and is issued and guaranteed by the central bank. The coin comes in three sizes: of one, half and a quarter ounce coins.

    The Governor of the Bank of Ghana, Dr Johnson Asiama, during the MPC press briefing re-emphasised that the initiative is designed to ensure that every Ghanaian has the opportunity to own a form of gold, reflecting the country’s heritage as one of the world’s leading gold producers.

    “There is a lot of interest in the Gold Coin, we need to relaunch it as part of the Cedi @60 programmes. We are coming back stronger on that programme”, Dr Johnson Asiama disclosed while answering a question asked by Economy Time’s Adnan Adams Mohammed. “Every Ghanaian should be able to buy some form of gold, and that is exactly what this program intends to achieve.”

    This news is well received by the Ghanaian public at a time when global demand for gold remains strong, and Ghana continues to prioritize gold in its reserves management and currency stabilization efforts.

    Purpose of the Gold Coin

    As part of the domestic gold programme, this initiative seeks to absorb excess liquidity in the market and strengthen the local currency against major international trading currencies.

    “The Ghana gold coin enables the Bank of Ghana to mop up excess liquidity in the banking sector and will supplement the bank’s bills for liquidity management,” the immediate past Governor, Dr Ernest Addison, said during its introductory launch last year. “It gives those resident in Ghana an additional avenue to invest to reap the benefits of the Bank of Ghana’s domestic gold purchase program.”

    Additionally, the aim is to offer the public an innovative investment avenue while bolstering the country’s financial instruments portfolio.

    Meanwhile, some economists say the program could serve as a low-risk savings option for households and further support efforts to develop a local gold market.

    Key Features

    The coins are sold through commercial banks to be bought in cedis and priced on the basis of London Bullion Market Association auction price. The gold complies with the central bank’s responsible gold sourcing rules.

    It features the Ghana Coat of Arms on the front and the Independence Arch at the back. It is packaged with a wooden storage box, a transparent coin holder, and a certificate of ownership

    Its initial price was pegged at: 1.0oz for GH₵45,020.48; 0.5oz for GH₵22,409.74 and 0.25oz for GH₵11,188.12 these being pegged to the US dollar price of gold on the global market.

    Investment Considerations:

    The Coin provides a hedge against inflation and currency depreciation, and diversification of investment portfolios.

    However, despite the strong surge in the price of gold initially fueling strong returns on investment, in recent months returns have turned negative since the appreciation of the cedi against the dollar has outstripped the rate of appreciation in the global market gold price.

    By Adnan Adams Mohammed

  • Commodity markets outlook promising for cocoa and gold

    Gold and Cocoa set for growth in 2025

     

    Adnan Adams Mohammed

     

    Cocoa and gold have been projected to record strong performances on the commodity market, according to analysts.

     

    Databank Research’s market outlook for 2025 indicates that the Gold price, which surged by 25.6% in 2024 due to geopolitical tensions and inflation concerns, is anticipated to rise further this year. Gold prices are expected to range between US$2,600 and US$3,100 per ounce, driven by potential interest rate cuts from the U.S. Federal Reserve and sustained demand for gold from central banks. Gold serves as the most preferred store of value during periods of currency markets volatility.

     

    Cocoa prices are also forecasted to remain elevated, closing this year between US$ 7,000 and US$ 9,600 per tonne. However, amidst the optimism concerning cocoa and gold prices, the price of benchmark Brent crude oil is projected to continuously face difficulties.

     

    Ghanaian investors are encouraged to diversify their portfolios by considering gold-backed securities, such as the Ghana Gold Coin introduced by the Bank of Ghana, as a hedge against economic uncertainties. However, they should prudently measure the upside potential for gold prices against cedi – dollar exchange risks; it is instructive that the cedi price of the BoG Gold Coins fell during the last weeks of 2024 due to the appreciation of the cedi against the US dollar.

     

    Persistent supply challenges, exacerbated by the implementation of the EU Deforestation Regulation, are expected to constrain global cocoa output.

     

    Conversely, Brent crude oil prices, which declined by 20.31% in 2024, are projected to stabilize below US$ 76 per barrel in 2025. Factors such as high U.S. inventories, economic slowdowns in major consuming nations, and a global shift toward cleaner energy are likely to weigh on demand.

     

    With these trends, 2025 presents diverse opportunities for investors, particularly in gold and cocoa, while the oil market may require cautious navigation amidst ongoing challenges.

     

     

  • BoG’s gold coin effectiveness to tackle Ghana’s dollarised economy critiqued

    Ghana gold coin

     

    Adnan Adams Mohammed

     

    The Institute of Economic Affairs (IEA) has critically assessed the Bank of Ghana’s recently launched Ghana Gold Coin (GGC), questioning its effectiveness in tackling the country’s reliance on the U.S. dollar.

     

    During the launch, the central bank noted that the GGC will encourage savings and improve liquidity in financial markets.

     

    However, the IEA’s latest report casts doubt on the coin’s impact, suggesting that the central bank should instead address more pressing economic challenges like inflation and fiscal imbalances.

     

    “Offering the GGC as an alternative asset to the dollar seems to be an admission of failure to deal with the real problems facing the economy, which drives Ghanaians to hold dollars instead of cedis,” the report asserts.

     

    The IEA also disputed the Bank’s claims about the GGC’s role in managing liquidity, noting that “the Bank is expected to buy gold from miners with cedis… [and] the sale of GGCs back to Ghanaians in exchange for those same cedis injected into the economy ultimately results in zero liquidity withdrawal.”

     

    According to the IEA, deeper reforms are needed to reduce the demand for foreign currency, emphasising that “the Bank should focus on dealing with the fundamental causes of the cedi depreciation.”

     

    The report urges measures such as enforcing fiscal and monetary discipline to ease pressure on the cedi, narrowing the inflation gap with trading partners, and addressing foreign exchange imbalances through structural reforms.