The Bank of Ghana (BoG) has absorbed GH¢21.41 billion from the financial system in the past week as it steps up efforts to manage liquidity ahead of its next Monetary Policy Committee (MPC) meeting.
The money was taken from banks and other participating financial institutions through the issuance of 14-day Bank of Ghana Bills.
The first tender, held on Monday, saw the central bank accept GH¢13.71 billion at an interest rate of 10.5%.
Another GH¢7.7 billion was absorbed during a second tender held on Wednesday, also at 10.5%.
The two operations bring the total amount of liquidity absorbed by the BoG this week to GH¢21.41 billion.
The 14-day bills mean the funds have been temporarily taken out of circulation, allowing the central bank to manage short-term liquidity conditions in the financial system.
The move could affect money-market rates, bank liquidity and funding costs as financial institutions adjust their liquidity positions.
The BoG’s 132nd MPC meeting is scheduled for September 22 to 24, with the next monetary policy decision expected on Thursday, September 24.
Liquidity management and sterilisation remain among the tools used by the central bank to influence monetary conditions.
The latest operation is therefore expected to be closely watched ahead of the MPC meeting, particularly for its possible effect on money-market conditions and bank liquidity.
