Dr. Akwasi Agyeman Britwam Economist | CPA | Banker | Principal Marketing consultant and Founding father of Acuity Benchmark |
In Greek mythology, Atlas was a strong Titan destined to hold the burden of heaven without end. Historical poets depicted him as a determine of nice energy. In a merciless twist of irony, he was a tragic guardian whose struggling saved the world itself in stability. Whereas humanity traded, celebrated, and sought prosperity below him, Atlas stood quietly on the sting of existence, absorbing burdens that few might absolutely comprehend. A bitter and unavoidable irony, a haunting zero-sum recreation. The person who had remained steady was step by step weighed down by the very duties he had taken on. Take into account this passage from mythology. At what level do guardians themselves change into victims of the very stability they’re tasked with defending?
GH¢15 billion loss construction
The identical contradictions as within the earlier line are written in ink on the newly launched 2025 monetary statements of the “large” Financial institution of Ghana (BoG). Behind the reassuring nationwide story of easing inflation, relative change charge calm, bettering investor confidence and falling Treasury invoice charges lies a way more delicate institutional actuality. The central financial institution, which supported stability via one in every of Ghana’s most turbulent financial durations, now seems to be financially harm by the stabilization course of itself. The reported losses of GH¢15.6 billion (equal to $1.2 billion) in 2025, mixed with the deepening unfavourable fairness, have sparked widespread public debate over whether or not the central financial institution stays the guardian of financial stability or has begun to soak up an excessive amount of of the ache related to sustaining financial stability.
On the floor, this contradiction is disagreeable and extremely anxiety-provoking. How can macroeconomic circumstances enhance whereas central financial institution stability sheets deteriorate on the identical time?Central banks by no means comply with regular business logic. Former US Federal Reserve Chairman Paul Volcker persistently argued that central banks exist primarily to guard financial and monetary stability, to not maximize income.
The announcement that BoG had recorded an working lack of roughly GHF15.63 billion didn’t end result from a single disastrous transaction or remoted failure of enterprise. Reasonably, it mirrored the cumulative impact of some of the aggressive macroeconomic stabilization cycles in Ghana’s latest historical past. In line with the central financial institution’s personal disclosures, sterilization and liquidity administration prices alone amounted to roughly GHF16.73 billion in 2025, because the central financial institution stepped up efforts to remove extra liquidity and curb inflationary pressures.
Additional pressures have been created by reserve valuation changes and the long-term monetary influence of the Home Debt Change Program (DDEP). The central financial institution’s unfavourable capital place has reportedly worsened from about GHF61.3 billion originally of 2025 to about GHF93.82 billion by the tip of 2025, demonstrating the dimensions of the stability sheet pressure going through the financial institution.
Why central financial institution losses do not essentially imply coverage failure
The Gigawon 15.63 billion loss recorded by the central financial institution shouldn’t routinely be interpreted as proof of coverage failure. Central banks are basically completely different from business establishments. As Switzerland’s Financial institution for Worldwide Settlements (BIS) factors out, central banks can and infrequently do function with unfavourable capital whereas efficiently finishing up their mandate, so long as they keep public confidence of their capability to handle cash.
In actual fact, among the world’s main central banks have recorded historic losses after aggressive post-pandemic tightening cycles. Rising rates of interest, liquidity absorption and foreign money intervention have elevated working prices for authorities all over the world.
The US Federal Reserve reported a staggering working lack of $114 billion in 2023, adopted by $77.6 billion in 2024 and $18.7 billion in 2025. These losses have been resulting from paying business banks increased curiosity on their reserve balances whereas holding low-yield bonds.
The European Central Financial institution (ECB) recorded a lack of 7.9 billion euros in 2024, following its first loss in almost 20 years in 2023. The ECB famous that these losses are a direct results of the coverage measures essential to fight excessive inflation.
financial institution of england sIt additionally confronted billions in losses and requested the UK Treasury to switch funds to cowl the shortfall below the compensation settlement.
The central financial institution’s main mission is to not maximize income, however to keep up macroeconomic stability. Authorities such because the Worldwide Financial Fund (IMF) have burdened that central banks’ income are secondary to their capability to regulate inflation and handle change charges.
By 2025, inflationary pressures in Ghana have eased and change charge volatility has moderated. This represents the success of the BoG intervention. As former Financial institution of England Governor Mervyn King has argued, the price of stabilization is usually seen on the stability sheet, however its worth is seen in restoring confidence throughout the economic system.
A central financial institution working profitably amidst runaway inflation represents a far higher financial threat than a fiscally burdened central financial institution succeeding in restoring order. In occasions of disaster, central financial institution stability sheets usually soak up the prices of financial adjustment. The losses reported by central banks, like these of the Fed and the ECB, point out the prices of stabilization moderately than its failure.
Stability is rarely free
Financial stabilization is usually mentioned as if it have been an summary coverage aim divorced from institutional sacrifices. In apply, stabilization comes with actual monetary prices, and in periods of extreme macroeconomic turmoil, these prices are sometimes handed onto the central financial institution’s personal stability sheet. Nobel Prize winner Milton Friedman famously argued that there isn’t any such factor as a free lunch, and this precept applies poignantly to the fiscal prices of financial tightening.
Ghana’s latest inflation disaster required an aggressive coverage response. Inflationary pressures have change into entrenched, the Ghanaian Cedi has come below extreme downward stress, and investor confidence has fallen considerably. In such a scenario, the BoG had little room for passivity. Monetary tightening has change into inevitable.
Greater coverage charges have been launched to curb inflationary demand and solidify expectations. Nevertheless, the rise in coverage charges has additionally elevated central banks’ personal curiosity bills, notably via liquidity sterilization operations. In attempting to soak up extra liquidity from the banking system, the BoG incurred interest-related prices estimated at greater than Gigawon 16 billion in 2025 alone. As Claudio Borio, head of Switzerland’s BIS Monetary and Financial Division, factors out, the rewards of extra reserves in a excessive rate of interest atmosphere inherently lead to important income drains for central banks, usually resulting in accounting losses within the pursuit of worth stability.
Change charge protection additional elevated the burden. Defending financial stability in a fragile exterior atmosphere usually requires the deployment of international change reserves, market intervention, and confidence administration. These interventions contain important overhead. The BoG additionally reported reserve-related writedowns estimated at roughly GH¢8.3 billion. This determine additionally displays change charge fluctuations and changes to the Ghanaian Cedi equal worth of international change reserve property.
Satirically, among the very insurance policies that imposed fiscal burdens on the BoG additionally contributed to measurable macroeconomic enhancements. Though inflation slowed in the course of the yr, Ghana’s international change reserves reportedly recovered to a degree equal to about 4 and a half months of import cowl, in comparison with the extreme depletion skilled on the peak of the disaster.
That is the paradox of recent crisis-era central banking. Former IMF chief economist Raghuram Rajan has lengthy argued that profitable stabilization efforts can place monetary pressure on central banks themselves. Inflation is more likely to fall, change charge pressures will ease, and market confidence will step by step enhance. Satirically, the very establishments that present stabilization could also be financially weakened.
The general public usually solely sees losses. Much less apparent are the choice eventualities policymakers have been attempting to keep away from: runaway inflation, accelerated foreign money collapse, monetary instability, and a extreme decline in financial confidence. Stabilization is due to this fact a trade-off between fast institutional monetary ache and doubtlessly broader system collapse. In her analysis on sovereign debt, Harvard economist Carmen Reinhart has repeatedly noticed that in durations of financial disaster, public establishments usually soak up hidden monetary wounds lengthy earlier than broad macroeconomic stability is absolutely restored.
GoldBod, gold reserves and the rising stabilization burden
Central banks have historically been designed to operate as financial authorities moderately than broader nationwide growth monetary establishments. Nevertheless, throughout occasions of extreme financial disaster, the strains usually start to blur. Ghana’s latest expertise exhibits how rapidly central banks can evolve from guardians of economic stability to broader stabilizing foundations for the state itself. European Central Financial institution (ECB) President Christine Lagarde has repeatedly argued that fashionable central banks are more and more working in what she describes as an period of “polycrisis,” forcing financial authorities to transcend conventional inflation management to keep up broad-based monetary stability.
Lately, the BoG has been discovered to more and more help interventions associated to the buildup of international change reserves, international change stabilization, and home gold purchases. The financing preparations related to GoldBod offered one of many clearest examples of this escalation of burden. Goldbod’s personal audited monetary statements reportedly present a legal responsibility of over GH¢3.78 billion to be paid to the BoG by the tip of 2025 below the Home Gold Buy Program (DGPP).
The strategic advantages of this transfer are indeniable. Ghana’s gold reserves reportedly elevated from roughly 30.53 tonnes in January 2025 to greater than 38 tonnes by October 2025, strengthening the reserve buffer and bettering international change retention inside the nation’s economic system. Proponents of the intervention due to this fact argue that this system meaningfully contributed to macroeconomic stabilization throughout a interval of vulnerability.
Nevertheless, this kind of intervention inevitably has financial penalties. Public info surrounding the DGPP means that cumulative losses will exceed GH¢7 billion between 2022 and 2024. At a time when sterilization prices have been already rising, liquidity help, reserve accumulation, and change charge controls collectively lowered the scope for monetary maneuvering on the BoG’s stability sheet.
The scenario turned much more delicate following experiences that the central financial institution would liquidate a part of its gold reserves in 2025, leading to realized features estimated at roughly GH¢9.57 billion. On the one hand, the transfer demonstrated pragmatic reserve administration throughout a tough stabilization cycle. Mohamed El-Erian, president of Queen’s Faculty, Cambridge and former chief government of Pacific Funding Administration Firm (PIMCO), has usually argued that collected property are little greater than a consolation blanket on the stability sheet. These are strategic warfare chests that may be tapped into when financial circumstances take a flip for the more serious. In the meantime, the liquidation of gold reserves highlighted the depth of stress going through monetary establishments. As strategic reserve property start to ease operational burdens, the road between good disaster administration and organizational exhaustion turns into more and more skinny.
That is the tough actuality of central banking in fashionable occasions of disaster. Throughout turbulent occasions, central banks usually change into the economic system’s final shock absorbers, taking up duties far past conventional financial coverage. The problem, nevertheless, is to make sure that unconventional interventions adopted throughout occasions of disaster don’t step by step change into a everlasting institutional burden.
Like Atlas in Greek mythology, the Guardian might reach retaining others steady whereas slowly absorbing the burden of the accountability itself.
Who will shield the Guardian?
BoG’s monetary deterioration basically raises questions that transcend simply accounting losses. This necessitates a broader nationwide debate concerning the future resilience of Ghana’s governance, institutional safeguards, and financial coverage operations.
Transparency and operational independence change into much more essential when central banks are anticipated to soak up extraordinary stabilization burdens in occasions of disaster. Raghuram Rajan, former Reserve Financial institution of India governor, has ceaselessly argued that central banks in rising economies should be impartial inside the authorities, however not impartial of the federal government. This implies specializing in deeper structural points. How quasi-fiscally accountable ought to a central financial institution be?What limits ought to govern strategic intervention?
These questions should not distinctive to Ghana. Former Federal Reserve Chairman Ben Bernanke’s crisis-era intervention in the course of the 2008 international monetary disaster demonstrated how central banks can step by step change into the economic system’s main stabilizing mechanism when the fiscal and market methods are below extreme pressure.
In the end, as Eswar Prasad of Cornell College and the Brookings Establishment suggests, a central financial institution’s credibility relies upon not solely on its capability to intervene but additionally on the power of the institutional framework that protects it from extreme political and monetary burdens. The problem forward for Ghana is a fragile balancing act and hard trade-offs between sustaining macroeconomic stability whereas concurrently defending the long-term institutional well being of the very guardians tasked with sustaining it.
Atlas, Exhaustion and the Price of Financial Survival
In spite of everything, BoG’s 2025 losses might be greater than only a tough monetary episode. These might characterize the hidden institutional prices of stabilizing the economic system throughout some of the turbulent durations in latest historical past.
It is onerous to disregard this irony. As inflation eased, change charge pressures eased, and confidence step by step returned, the stability sheets of the monetary establishments that had been main stabilization efforts weakened considerably. Guardians helped stabilize the economic system, however additionally they absorbed a lot of the burden of sustaining that stability.
For that reason, the controversy surrounding the BoG should stay balanced and intellectually sincere. This loss calls for scrutiny, transparency and accountability. However they need to even be understood inside the broader context of managing economies in occasions of disaster, the place central banks are sometimes the primary line of protection towards systemic instability.
Atlas’ weak spot was not resulting from lack of energy. He was weakened as a result of he carried a burden that no single group was ever supposed to hold without end. Maybe that is the profound lesson that emerges from central financial institution monetary statements. Monetary survival typically comes at a worth, and in some circumstances the guardian himself/herself could also be answerable for paying among the prices.
supply of data
Financial institution for Worldwide Settlements. (2024). Central financial institution capital and cash belief. BIS Doc No. 146.
Financial institution of Ghana. (2025). Official newest info on Gold Reserve Holdings.
Financial institution of Ghana. (2026). 2025 Monetary Statements: Questions and Solutions.
Financial institution of Ghana. (2026). Home Gold Buy Program (DGPP): 2022-2024 Cumulative Efficiency Report.
Financial institution of Ghana. (2026). Studies and Monetary Statements: December 31, 2025.
Mr. Ben Bernanke. (2015). The Braveness to Act: A Memoir of a Disaster and its Aftermath. WW Norton & Firm.
Carmen Reinhardt. (2009). This time it is completely different: Eight centuries of economic folly. Princeton College Press.
Christine Lagarde. (2024). Central banks within the period of polycrisis. ECB Press.
Claudio Borio. (2023). Rise up from the ground. BIS speech.
Eswar Prasad. (2023). The way forward for cash. Harvard College Press.
European Central Financial institution. (2025). Annual Report 2024: Monetary Statements and Coverage Operations.
Federal Reserve System. (2026). Annual Report back to Congress: Monetary Outcomes and Open Market Operations.
gold bod. (2026). Audited monetary statements for the yr ended December 31, 2025.
Worldwide Financial Fund. (2023). Central financial institution transparency and coverage effectiveness. IMF coverage doc.
Marvin King. (2016). The tip of alchemy: Cash, banking, and the way forward for the worldwide economic system. WW Norton & Firm.
Milton Friedman. (1975). There isn’t a such factor as a free lunch. Open Courtroom Publishing.
Mohamed El-Erian. (2023). Excerpts of public feedback and interviews relating to reserve drive deployment, disaster administration, and financial stabilization.
Raghuram Rajan. (2010). Fault strains: Hidden fissures nonetheless threaten the worldwide economic system. Princeton College Press.
Volcker, P. A., Gohten, T. (1992). Altering Destinies: The World’s Cash and the Menace to American Management. Instances Books.
by: AS Dr. Akwasi Republic Buritum
Economist | Licensed Public Accountant | Banker
| Principal Marketing consultant and Founding father of Acuity Benchmark |
