Tano North MP Dr Gideon Boako has defended former Vice President Dr Mahamudu Bawumia’s claim that the previous government operated under an IMF-imposed monthly cap on foreign exchange intervention.
In a Facebook post on Saturday, August 29, Dr Boako said attempts by government and NDC communicators to dispute the claim based on Ghana’s reported $3 billion in foreign exchange sales reflected a “fundamental misreading” of monetary policy and the IMF programme.
He explained that there was an agreed intervention cap which was initially set at $80 million per month before being scaled down to $60 million as part of measures to rebuild Ghana’s international reserves.
“As part of the programme conditionalities to rebuild Ghana’s international reserves to agreed thresholds, the IMF and the Bank of Ghana agreed on a strict monthly budget for direct FX intervention capped at $80 million and subsequently scaled down to $60 million,” Dr Boako wrote.
According to him, the previous government adhered to the agreed limits, contributing to Ghana exceeding its reserve build-up target by the end of 2024.
He argued that the performance subsequently gave the IMF confidence to relax the restrictions and allow the current government to intervene beyond the $80 million and $60 million thresholds.
Dr Boako further dismissed claims that the reported $3 billion in FX sales contradicted Dr Bawumia’s position, arguing that the figure covered different foreign exchange operations.
“Those citing the $3 billion are confusing two different BoG operations. The Bank of Ghana operates both an Auction budget and an Intervention budget. Both together make up the total FX sales figure reported,” he said.
He stressed that FX auctions are pre-announced and rules-based, while interventions are discretionary measures used by the central bank to manage volatility.
“It is therefore wrong to divide $3 billion by 12 and call it proof of intervention,” Dr Boako added.
