Bank of Ghana Unveils New Methodology for Foreign Exchange Market Reference Rate Calculation
The Bank of Ghana (BoG) has announced a significant overhaul of its Foreign Exchange (FX) Market Reference Rate (MRR) computation methodology, aligning it with international standards to enhance accuracy and transparency in reflecting market developments.
This updated approach is designed to broaden the data coverage used in calculating the MRR, ensuring it more effectively mirrors daily transactions between commercial banks and their clients.
The central bank stated that this initiative marks the first phase of a long-term strategy to adhere to the International Organization of Securities Commissions (IOSCO) Principles of Financial Benchmarks.
According to the BoG’s statement, the new MRR will be computed daily based on comprehensive data submissions from all licensed banks.
Each bank is required to report all spot US$/GH¢ transactions concluded on the reporting day by 3:30 PM, including both interbank market trades and transactions with clients that meet or exceed a nominal value of US$10,000.
This robust data collection aims to create a more representative view of current market conditions.
The calculation will yield a weighted median exchange rate, which will be published on the BoG’s website as the official closing rate for daily transactions.
This methodological shift underscores the BoG’s commitment to fostering greater reliability and integrity within Ghana’s foreign exchange market.
