Redirecting Mining Flows Signals Bold, Pragmatic Policy Shift – Standard Bank
Jibran Qureishi, Head of Africa Research at Standard Bank, has described the Bank of Ghana’s policy of redirecting foreign exchange inflows from the mining sector back to commercial banks as a bold but pragmatic policy shift.
The move, which took effect on September 1, 2025, reverses a 2022 decision that routed mining receipts directly to the central bank. Under the new framework, mining companies must channel their U.S. dollar earnings through one designated commercial bank, instead of spreading transactions across multiple banks. Policymakers say the change is designed to deepen market participation, improve FX liquidity, and reduce volatility in the cedi.
Explaining the rationale, the BoG noted that the 2022 centralization of flows had been triggered by sharp exchange rate pressures when banks competed aggressively for inflows. The new rule seeks to strike a balance between stability and market depth.
Commenting on the decision, Jibran Qureishi said, “Redirecting mining flows back to the market is a bold but pragmatic step that could help improve FX liquidity in Ghana. However, this measure is currently on a three-month trial basis, and if excess volatility emerges, the BoG may revert to the old framework. What’s encouraging is that the broader market remains short on USD/GHS, which could still support the cedi in the near term.”
The policy shift coincides with a period of steady macroeconomic improvement. Inflation has eased for the eighth consecutive month, falling to 11.5% in August from 12.1% in July, well below the average of 20.4% in the first half of 2025. Food inflation contracted by 1.3% month-on-month in August, while non-food inflation also dropped to 8.7% year-on-year.
Mr. Qureishi added that the disinflationary trend could create space for further rate cuts:
“We still anticipate headline inflation to fall to between 7.4% and 7.8% by December 2025. This disinflationary path should provide the Monetary Policy Committee room to cut rates further, potentially reducing the Monetary Policy Rate by 500 to 700 basis points before the end of the year.”
Meanwhile, the Ministry of Finance is preparing to resume new primary cedi bond issuances in the fourth quarter as it reviews proposals from market players. Together, these reforms signal Ghana’s ongoing efforts to stabilize the economy, restore investor confidence, and reinforce market-driven mechanisms for growth.
Picture: Jibran Qureishi, Head, Africa Research at Standard Bank