BoG struggles to meet $107m dollar demand in forex auction
The Central Bank failed to meet a $107m dollar demand by businesses in its recent forex forward auction held on Tuesday, September 6, 2022.
This is despite the $750m recently received from the Afreximbank to support the country’s foreign reserves and help stabilise the local currency.
The Central Bank in the forex forward auction, only managed to provide for businesses in need of the greenback some $25m for their operations.
In making the $25m available to businesses, the Central Bank fell short of supplying some $82m to businesses that participated in the forex auction.
Bids were made for the American dollar for the 7 day, 15 day, 30 day, 45 day, 60 day and 75 day tenors.
Total bids submitted for the 7 day tenor amounted to $54.25 million of which the Bank of Ghana (BoG) accepted $10.25 million.
For the 15 day, 30 day, 45 day and 60 day tenors, bids made totaled $32.75 million, $16.75 million, $3.5 million and $1 million respectively.
The BoG, for the 15 day, 30 day and 45 day tenors accepted bids totaling $6.5 million, $4.75 million and $2.5 million respectively.
For the 60 day tenors, the Central Bank accepted bids to the tune of $1 million.
Some $150 million dollars is projected to be sold out to authorised dealers in the third quarter of the year.
This is per the Bank’s third quarter Auction Target Calendar for Multiple-Price Foreign Exchange Forward Auction.
According to the Bank of Ghana, the said amount is going to be sold at the Foreign Exchange Forward Auction in accordance to its auction guidelines.
Compared to the some $350m auctioned in the last quarter, the Central Bank’s decision to auction $150m for the third quarter indicates a reduction of some $200m in its Forex forward auction.
The reduction in its forex auction can be attributed to the decline in the Bank’s foreign reserves from a little above $9.7bn last year to $7.6bn in June this year.
