News Guide Africa

Tag: Gold prices

  • Ghana faces fiscal storm as gold prices fall

    Ghana faces fiscal storm as gold prices fall

    By Adnan Adams Mohammed

    Ghana’s economic roadmap for 2026 is hitting a significant roadblock as the global gold market enters a decisive retreat.

    The precious metal, which served as the lifeblood of the nation’s 2025 recovery, has seen prices consistently slip below the critical US$4,700 per ounce threshold, sparking fears of a substantial revenue shortfall for the national treasury.

    This “gold retreat” is driven by a global glut and a strengthening U.S. Dollar, forcing the government and mining giants to rethink their strategies in real-time.

    The current slump is a classic case of supply-side resilience meeting weakened investment demand. According to international market data, the primary driver is the U.S. Federal Reserve’s “higher for longer” interest rate policy.

    Gold, which pays no yield, becomes less attractive when investors can secure 4–5% guaranteed returns in government bonds. This “opportunity cost” has triggered a massive sell-off from major exchange-traded funds (ETFs). Furthermore, a surging dollar has made gold prohibitively expensive for buyers in major consuming hubs like India and China, further cooling global demand.

    The visual above is structured into two main components:

    ● Supply vs. Demand Trends (2025-2026): A clear bar chart that displays a balanced market in 2025, followed by the significant shifts in 2026—a 15% increase in mining output contrasting sharply with a 12% drop in investment demand.

    ● Key Pressure Points: The bottom section features three icons that visually summarize the drivers of this shift: ‘High Fed Rates’ (showing the cost of non-yielding gold), a ‘Strong USD’ (making gold more expensive globally), and a ‘Central Bank Slowdown’ (depicting reduced official purchasing).

    The Ghanaian impact: export strain

    The consequences for Ghana are profound. In the 2025 fiscal year, gold accounted for over 40% of the country’s total export revenues, officially surpassing both cocoa and oil. This influx of “gold dollars” was vital for stabilizing the Cedi and funding critical infrastructure.

    However, the 2026 Budget Statement was built on the assumption of gold prices remaining at historic highs. Industry analysts warn that for every US$100 drop in the spot price per ounce, Ghana’s annual export receipts could diminish by hundreds of millions of dollars.

    Mining hubs under pressure

    The price dip is sending shockwaves through the “Golden Triangle.” Industry giants like AngloGold Ashanti and Newmont are signaling “operational adjustments.” Between high energy costs and lower realized prices, profit margins are being squeezed to the breaking point.

    The concern is not just corporate; it’s social. A prolonged slump could force marginal projects into “care and maintenance,” threatening thousands of jobs in mining hubs like Obuasi and Tarkwa.

    The government’s counter-move

    While the Bank of Ghana’s “Gold-for-Oil” program remains a successful shield for fuel security, it cannot fully offset the valuation loss in total trade. The government is now under immense pressure to accelerate its diversification agenda to plug the fiscal deficit:

    This involves moving beyond extraction to speed up the processing of newly discovered lithium and other “green” minerals; shifting away from raw cocoa bean exports to value added, higher-margin processed products; and investing massively in processing for cashews and the newly prioritized tomato sector to reduce import dependency.

    As 2026 progresses, the “gold retreat” has transformed economic diversification from a long-term goal into an immediate national imperative. Ghana must now prove it can thrive even when its most glittering asset lose its luster.

     

     

     

     

     

     

     

     

     

  • Why Investors are Trading Gold for Yield

    Why Investors are Trading Gold for Yield

    By Adnan Adams Mohammed;

    Financial and Economic Journalist

    For centuries, gold has been the undisputed “safe havens” for investors.

    When the world trembles be it from war, inflation, or political upheaval investors have traditionally sprinted toward the yellow metal. But as we cross the first quarter of 2026, a strange phenomenon is unfolding in the global markets: gold is retreating precisely when the headlines say it should be soaring.

    The precious metal has recently endured its longest losing streak in years, with prices sliding below the US$4,700 mark. This downward spiral comes despite a backdrop of geopolitical tension and energy shocks that would, in any other era, have sent bullion prices to the moon.

    The “higher for longer” shadow

    The primary antagonist in gold’s current drama is not a lack of demand, but the “Iron Grip” of global central banks. The U.S. Federal Reserve, alongside its peers in Europe and Asia, has signaled a hawkish stance that few saw coming at the start of the year.

    With oil prices hovering above US$100 per barrel due to ongoing Middle Eastern instability, inflation has proven stickier than anticipated. Consequently, central banks are refusing to blink. By signaling that interest rate cuts are “off the table” for the foreseeable future, they have increased the “opportunity cost” of holding gold.

    “Gold doesn’t pay a dividend or an interest rate,” explains one senior market analyst. “When you can get a guaranteed 4% or 5% return on government bonds because central banks are keeping rates high, the ‘shiny rock’ in your vault starts to look a lot less attractive, no matter how much trouble is brewing globally.”

    The inflation paradox

    The current market presents a fascinating paradox. Traditionally, gold is a hedge against inflation. However, in 2026, inflation is actually hurting gold. This is because modern markets view high inflation not as a reason to buy gold, but as a reason for the Federal Reserve to get aggressive. The stronger the inflation data, the more likely the Fed is to hike rates or keep them elevated, which in turn strengthens the U.S. Dollar. Since gold is priced in dollars, a “Super-Greenback” makes the metal more expensive for international buyers, further dampening demand.

    A technical reset?

    Despite the gloom, many analysts argue this is a “healthy correction” rather than a collapse. Earlier in 2026, gold hit a staggering all-time high of US$5,595 per ounce. The current slide, while painful for short-term traders, is being viewed by institutional giants like J.P. Morgan and Goldman Sachs as a necessary reset.

    “The structural bull case for gold isn’t dead,” says a report from Fitch Solutions. “Central banks in emerging markets are still buying gold at record levels to diversify away from the dollar. What we are seeing now is the ‘speculative froth’ being blown off the top.”

    The road ahead

    For the average investor in Ghana and abroad, the next 30 to 60 days will be critical. If central banks begin to see a cooling in energy prices, they may soften their tone, providing the “oxygen” gold needs to rally again.

    Until then, the Gilded King remains in retreat, proving that even the world’s oldest currency is not immune to the relentless math of modern monetary policy. In 2026, it seems, the “Safe Haven” has a new landlord: the Central Bank Policy Rate.

     

     

     

     

  • Monetary Policy vs. Precious Metals: Why Gold is Trapped in a 2026 Bear Market

    Monetary Policy vs. Precious Metals: Why Gold is Trapped in a 2026 Bear Market

    By Adnan Adams Mohammed;

    Financial and Economic Journalist

    In a startling reversal of fortune, gold the “perpetual safe haven” has entered a decisive bear market in March 2026. After hitting a historic peak of US$5,589 per ounce in late January, the metal plummeted nearly 19%, trading as low as US$4,551 last week.

    While geopolitical tensions in the Middle East and threats to the Strait of Hormuz typically send gold prices climbing, a new economic reality has taken hold. In 2026, the traditional “flight to safety” is being rerouted by the sheer gravity of global monetary policy.

    The hawkish “hold”: why the Fed broke the rally

    The primary catalyst for the current slump is a radical shift in expectations from the U.S. Federal Reserve. On March 18, the Fed held interest rates steady at 3.5%–3.75%, but it was the “dot plot” that rattled investors.

    Plagued by sticky inflation fueled by rising energy costs, the Fed signaled it would likely authorize only one rate cut for the entirety of 2026.

    The Opportunity Cost: Because gold pays no interest, it struggles to compete when government bonds offer high, guaranteed yields.

    The Dollar Factor: The hawkish stance pushed the U.S. Dollar Index toward the 100.0 mark, making gold which is priced in dollars prohibitively expensive for international buyers.

    The inflation paradox of 2026

    In a typical cycle, high inflation (driven currently by an oil spike above US$100 per barrel) would be gold’s best friend. However, in the current landscape, markets view high inflation as a “green light” for central banks to keep rates high.

    “Gold is being sold during an active conflict because the oil shock from that conflict is forcing central banks to stay hawkish,” noted a research strategist at Pepperstone. “Higher oil means higher inflation, which means gold suffers despite the geopolitical backdrop.”

    Institutional “paper” flushes

    The bear market is being accelerated by the “paper market” futures contracts and gold-backed ETFs. As prices began to slip in February, many leveraged institutional investors faced margin calls.

    Liquidity Squeeze: Large funds have been selling their gold positions not because they lack faith in the metal, but because gold is highly liquid. They are “selling what they can” to raise cash and cover losses in other volatile sectors like silver and tech.

    Retail Retreat: After a 70% surge in 2025, many retail investors are booking profits, further increasing the “global glut” of available bullion.

    Ghana’s strategic pivot

    For Ghana, the world’s leading gold producer per capita, this “bear trap” is more than a market headline, it’s a budgetary crisis. With export revenues directly tied to the spot price, the Ministry of Finance is reportedly reviewing its 2026 revenue targets.

    However, the Bank of Ghana remains a steady hand. While private investors flee, the central bank continues its “Gold-for-Reserve” program and remains part of a broader trend of “de-dollarization,” where sovereign states accumulate physical gold as a long-term hedge against the very systemic risks currently causing the price dip.

    As gold is currently caught in a tug-of-war between geopolitical fear (which wants prices higher) and monetary math (which is pulling prices lower), for now, the math is winning.

    Analysts suggest that until the Federal Reserve moves from a “hawkish hold” to a true “easing cycle,” the gilded king will remain trapped in its 2026 retreat.

     

     

     

  • Ghana’s gold industry sovereignty under attack by diplomatic heavyweights

    Ghana’s gold industry sovereignty under attack by diplomatic heavyweights

    By Adnan Adams Mohammed

    In an unprecedented show of diplomatic coordination, some of the world’s most powerful economies have locked horns with the Ghanaian government over a proposed overhaul of the nation’s gold royalty regime.

    What began as a domestic fiscal policy to capture windfall profits from record-high gold prices has transformed into a high-stakes geopolitical standoff. At the heart of the dispute is a transition from a fixed 5% royalty to a sliding scale that could reach as high as 12%.

    In a rare moment of alignment; the United States and China, joined by the UK, Canada, Australia, and South Africa, have submitted a joint document to the Ministry of Lands and Natural Resources. Their message is clear: the proposed hike threatens the viability of the multi-billion dollar investments their corporations have poured into the soil of Africa’s largest gold producer.

    “This is the first time we have seen the diplomatic community get involved at this scale,” Reuters has reported. The intervention marks a significant escalation, as foreign missions typically leave tax negotiations to the companies themselves.

    The “sliding scale”

    The government’s plan, laid before Parliament in December 2025, aims to replace the predictable 5% flat rate with a tiered system. With global gold prices currently hovering above US$5,100 per ounce, the 12% cap is no longer a theoretical maximum it is the immediate reality for any miner operating today.

    Analysts from Joy News Research suggest that when the new royalty is combined with existing corporate taxes and the 3% Growth and Sustainability Levy, the state’s total take could jump from 50% to a staggering 68%.

    Industry giants sound the alarm

    The “Big Four” of Ghanaian mining; Newmont, Gold Fields, AngloGold Ashanti, and Perseus, have already voiced their opposition. Even Chinese-owned operations, often seen as more risk-tolerant, have broken their silence. The Association of China-Ghana Mining warned that the proposal could “threaten the viability” of major projects like the Akyem and Wassa mines.

    The timing is particularly sensitive. Just days ago, Ghana slipped seven places in the Global Mining Investment Attractiveness Index, falling to 53rd globally. Investors argue that while gold prices are high, so is the cost of extraction in a high-inflation environment.

    The sovereignty dilemma

    The Ministry of Lands and Natural Resources maintains that the reform is a matter of national interest. “The government must ensure Ghana benefits more from its mineral wealth,” a source close to the ministry stated. They argue that during “super-cycles” where bullion prices smash records, the citizens deserve a larger slice of the pie.

    As the legislative instrument reaches its maturity date on Monday, March 9, the government faces a choice: proceed with the hike to shore up national revenue, or blink in the face of a unified diplomatic front to protect its long-term investment reputation.

    Comparison of proposed royalty tiers

    Gold Price (per ounce)  –    Proposed Royalty Rate

    Up to $1,900                     –      5%

    $2,001 – $2,500               –         7%

    $3,001 – $3,500               –        9%

    Above $4,500                    –       12%

     

     

     

     

     

  • Industry warns new ‘Royalty Regime’ could trigger ‘Capital Flight’ and job losses

    Industry warns new ‘Royalty Regime’ could trigger ‘Capital Flight’ and job losses

    By Adnan Adams Mohammed

    The Ghana Chamber of Mines has issued a stark warning to the government, asserting that a proposed overhaul of the mining fiscal regime could dismantle Ghana’s status as a top investment destination.

    The industry body argues that the new “sliding-scale royalty regime” risks branding Ghana as a “fiscal outlier,” potentially driving billions in capital toward more stable neighbors like Côte d’Ivoire and Burkina Faso.

    This pushback follows a major policy announcement by the Acting CEO of the Minerals Commission, Isaac Tandoh, who revealed plans to scrap long-term stability agreements and significantly hike royalties. The reforms aim to ensure the state captures a fairer share of the recent “gold super-cycle,” with spot gold prices trading near record highs of US$5,100 per ounce.

    The “Fiscal Outlier” threat

    The crux of the tension lies in the proposed jump in royalty rates. Currently, mining firms pay a flat 5% royalty. Under the new sliding-scale framework, this could soar to between 9% and 12% (and potentially as high as 17% when combined with other levies) depending on global gold prices.

    “International benchmarking indicates that Ghana already occupies a high-tax position,” the Chamber stated in a position paper released last week. When the new royalties are added to the 35% corporate income tax and the State’s 10% free-carried interest, the cumulative burden becomes unsustainable for many operations.

    Modeling the damage: Jobs and revenue

    The Chamber’s investment modeling suggests that the policy could have a “non-linear” and devastating impact on the economy:

    ● Job Losses: An estimated 1,344 jobs are at risk, with 88% of those coming from local host communities.

    ● Stalled Projects: Major operations, such as AngloGold Ashanti’s Obuasi Mine, could see an 8% decline in Net Present Value (NPV), potentially pushing projects below the “hurdle rate” required for reinvestment.

    ● Supply Chain Contraction: Local procurement, a lifeline for many Ghanaian businesses, could contract by over US$1.7 billion over time.

    “The question is whether the government wants revenue on a sustainable basis or just in the next few years before investments move elsewhere,” warned Dr. Ken Ashigbey, CEO of the Chamber of Mines.

    A “double-edged knife”

    While the government argues that these reforms are necessary to “indigenize” value and correct past “abuses” of stability agreements, industry experts call it a gamble. By scrapping the clauses that shield investors from sudden policy shifts, Ghana may increase its “sovereign risk perception” at a time when competition for mining capital is global.

    The Minerals Commission maintains that the reforms are about balance. “We had to do something to bridge this gap,” said Isaac Tandoh, noting that some companies have historically used revenues from Ghana to acquire assets elsewhere while refusing basic local obligations.

    As the draft bill prepares to head to Parliament by March, the mining industry is calling for a “sweet spot” a regime that allows the state to benefit from high prices without choking the very companies providing the revenue.

     

     

  • Gold price could hit US$5,000

    Gold price could hit US$5,000

    Spot gold prices hit a record high of US$3,578.50 per ounce last week on expectations of a U.S. Federal Reserve interest rate cut later this month, while lingering global uncertainties kept safe-haven demand firmly in play, according to Reuters.

    Goldman Sachs predicts that gold prices could surge well above its US$4,000 per troy ounce baseline by mid-2026, should private investors diversify more heavily into the metal.

    “Gold remains our highest-conviction long recommendation,” Goldman Sachs said in a note last week, while forecasting gold prices at US$3,700 by the end of 2025 assuming strong central bank buying.

    However, this baseline view does not factor in a major shift by private investors out of U.S. dollar assets into gold, a scenario that could push prices to as high as US$4,500 per ounce.

    It also said that a loss of Fed independence could trigger higher inflation, a rise in long-end bond yields, weaker equities, and a decline in the dollar’s reserve currency status while gold, as a store of value not reliant on institutional trust – stood to benefit.

    U.S. President Donald Trump has intensified efforts to exert control over the Fed, whose ability to manage inflation effectively is widely seen as requiring freedom from political influence over interest rate decisions.

    Goldman Sachs also estimated that, assuming all else remains constant, gold prices could approach US$5,000 per troy ounce if 1% of the private money invested in the U.S. Treasury market was reallocated to gold.

    The precious metal is viewed as a safer asset for investors during times of economic uncertainty, and its price rose earlier this year after US President Donald Trump announced wide ranging tariffs which have upset global trade.

    Analysts say the price has also been lifted by expectations that the US central bank will cut its key interest rate, making gold an even more attractive prospect for investors.

    Adrian Ash, director of research at BullionVault, told the BBC’s Today programme that the rise in gold prices over the past few months is really down to Trump and “what he’s done to geopolitics [and] what he’s done to global trade”.

    “It was really the US election last year that really put a fire under it,” he said.

    Analysts also cite worries over the independence of the US central bank, the Federal Reserve, as another factor driving the gold price.

    Trump has launched repeated attacks on the Federal Reserve’s chair, Jerome Powell, and recently attempted to fire one of its governors, Lisa Cook.

    Derren Nathan from Hargreaves Lansdown said it was Trump’s “attempts to undermine the independence of the Federal Reserve Bank” that was “driving renewed interest in safe haven assets including gold”.

    On Monday, the head of the European Central Bank Christine Lagarde warned that if Trump were to undermine the independence of the Fed, it would represent a “very serious danger” to the global economy.

    She said if the Fed was forced to respond to Trump’s politics, it would have a “very worrying” impact on economic stability in the US, and therefore in the rest of the world as well.

    Mr Ash added that when the price of gold surges because of investor interest, it was usually tempered by a slowdown in buying from China and India two of the biggest markets for gold jewelry.

    But this time, he said gold was continuing to find demand in China and India as, rather than exiting the market during times of high prices, jewelry buyers turn towards buying investment gold products such as bars or coins.

    Gold’s general price increase also comes from a “raft” of other reasons, including Russia’s invasion of Ukraine which has added to a climate of general political uncertainty, said precious metals analyst Suki Cooper from Standard Chartered.

    She adds that this year, the impact of changing trade policies on inflation and supply chains has also fueled the gold price.

    “Gold has found added support from US dollar weakness earlier in the year as the preferred safe haven,” she concluded.

     

  • Gold prices surge…crossing US$3,000/ounce

    “Gold prices hit record $3,000/oz.”

     

     

    Adnan Adams Mohammad

     

    Ghana’s major export commodities prices traded with mixed fortunes on the international commodities market in early 2025.

     

    Gold traded at over US$3,000 per fine ounce for the very first time on March 14, this is after gold prices averaged US$2,897.3 per fine ounce in February this year, indicating year-on-year price growth of 9.7 percent.

     

    “Gold prices crossed the US$3,000 per fine ounce on March 14, 2025, on account of heightened economic uncertainty triggered by the trade and geopolitical tensions, persistent inflation, and weakening US dollar”, the Governor of the Bank of Ghana, Dr Johnson Asiama told journalists last week.

     

    Similarly, crude oil prices recorded a marginal annual growth of 2.4 percent to settle at an average price of US$74.95 per barrel.

     

    Cocoa prices, however, declined by 8.5 percent driven by improving supply outlook for the current 2024/25 season, Dr Asiama stated.

     

    Meanwhile, in the banking sector, Dr Asiama said that banks’ performance continued to improve.

     

    Total bank assets recorded year on year 34.0 percent growth at the end of February 2025 relative to 12.1 percent growth, over the previous year, he said.

     

    With regulatory reliefs, the banking industry’s Capital Adequacy Ratio (CAR) was higher at 14.4 percent compared to 13.6 percent in the same period last year, Dr Asiama added.

     

    “Without reliefs, CAR was 12.1 percent. The industry’s Non-Performing Loan (NPL) ratio declined to 22.6 percent in February 2025 from 24.6 percent in February 2024. Excluding the loans in the loss category, which are fully provisioned, the NPL ratio as at end-February 2025 was 8.9 percent,” he said.

     

    Dr Asiama further stated that overall, the Financial Soundness Indicators showed broad improvements in asset growth, solvency, liquidity, efficiency, and profitability.

     

    The fiscal policy stance was more expansionary than expected in 2024. The 2024 fiscal deficit, on a commitment basis, was 7.9 percent of GDP against a target of 3.8 percent of GDP, on the back of higher expenditures than target.

     

    “This notwithstanding, early indications from banking sector data suggest some improvements in fiscal performance in early 2025.

     

    “This, along with the commitment to fiscal consolidation presented in the 2025 budget, should support the fiscal outlook. Also, the ratio of public debt to GDP declined supported by the debt restructuring,” he said.

     

     

  • 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.

     

     

  • Commodity markets outlook promising for cocoa and gold

    Commodity markets (cocoa and gold )

     

    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 are 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.

    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 cocoa and gold, 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.

    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.