https://www.myjoyonline.com/bog-has-built-strong-reserves-to-stabilise-cedi-prices-ae-deputy-governor/-------https://www.myjoyonline.com/bog-has-built-strong-reserves-to-stabilise-cedi-prices-ae-deputy-governor/
The Bank of Ghana (BoG) has assured local businesses, banks and foreign investors that it has the required reserves to stabilise prices and the cedi. Dr Maxwell Opoku Afari, First Deputy Governor of the Bank, said this when he gave the keynote address at the launch of the Absa Africa Financial Markets Index 2019 in Washington DC. He noted that there was no need for investors, businesses and banks to panic because the situation is under control and the Bank of Ghana would step in when it matters to provide banks with the needed FX support to meet their needs. Status of Ghana’s reserves and movements in the Consumer Price Index   JoyBusiness understands the Bank of Ghana’s reserves should be around $9.4 billion this month and could hit about $10 billion from November.  This is when the last tranche of the cocoa loan syndication finally hits Bank of Ghana’s accounts. Also, recent data from the Ghana Statistical Service puts September 2019 inflation at 7.6 per cent another decline from the month of August at 7.8 per cent. The significant decline in the Consumer Price Index from July 2019 follows Ghana Statistical Services decision to review the basket used in measuring inflation in Ghana.  For some, the development puts some pressure on the Central Bank to review its current medium-term inflation outlook which stands at +/- 2  Supporting local and foreign investors Dr Maxwell Opoku Afari said due to the high interest in Ghana as a major destination for higher yield-seeking non-resident investors, everything must be done to develop a liquid, deep and efficient domestic interbank markets, “that can support these foreign investors to them to continue to invest in our markets.” There is more work to be done as we seek to develop the domestic market to enhance efficiency and create the needed market for capital” he added.   He also disclosed that the Bank of Ghana and Government are initiating policies that would further strengthen the financial and payment services to help engender financial inclusion, “some of these policies include agent registry, National Identification Exercise and the digital registry address system. Dr Opoku-Afari said, “the potential to expand our economies through structural reforms and initiatives should form the cornerstone of our policies.” Ghana is going through, structural transformation and these initiated policies are supporting the move in that direction”  Netting rights and setoff for financial contracts in banks According to Dr Opoku- Afari the Central Bank would soon issue a notice to clarify the recognition of netting arraignment in financial contracts in the Banking and Special Deposit-Taking Institutions Act, “this is in support of the efforts to recognize Ghana as a netting positive jurisdiction.  What is netting rights and setoff? Netting entails offsetting the value of multiple positions or payments due to be exchanged between two or more parties. It can be used to determine which party is owed remuneration in a multiparty agreement.  It is a general concept that has a number of specific uses, specifically in financial markets. Netting used in trading, where an investor can offset a position in one security or currency with another position either in the same security or another one. The goal in netting is to offset losses in one position with gains in another.  Also, when a company files for bankruptcy, parties tend to net the balances owed to each other. This is also called a set-off clause or set-off law. That is, a company doing business with a defaulting company will offset any money they owe the defaulting company with money that’s owed them.  The remainder represents the total amount owed by them or to them, which can be used in bankruptcy proceedings. Companies can also use netting to simplify third-party invoices, ultimately reducing multiple invoices into a single one.  For example, several divisions in a large transport corporation purchase paper supplies from a single supplier, but the paper supplier also uses the same transport company to ship its products to others. By netting how much each party owes the other, a single invoice can be created for the company that has the outstanding bill.  

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