On the 27th of September 2024, the Governor of the Bank of Ghana launched the Ghana Gold Coin (GCC).
In his launching remarks, the Governor stated "The Ghana Gold Coin initiative is a testament to Bank of Ghana's unwavering commitment to deepen financial markets by offering other avenues for savers to invest."
He further stated that "The Ghana Gold Coin also served as a significant reminder of Ghana's rich gold heritage."
What is the Ghana Gold Coin (GGC)?
The GGC is a coin manufactured from dore gold that has been refined to 99.99% purity, which gives the coin the original gold colour and is solely issued and guaranteed by the Bank of Ghana.The Ghana Gold Coin is available in three different sizes: namely 1 oz Coin, 1/2 oz Coin and 1/4 oz Coin (as depicted above) to suit different investment needs.
According to Bank of Ghana, each coin has the Ghana Coat of Arms in front and the Independence Arch at the back.
Furthermore, each packing includes the gold coin, a wooden storage box, a transparent coin holder and a certificate of ownership.
Related Investment Posts
- Positive Investment Culture: What to Invest in With GHS100
- Make Money Online The Right Way For Every Ghanaian
- Losses in Investments: Why People Lose Money When They Invest
What is the Rationale Behind Ghana Gold Coin (GGC)?
According to Bank of Ghana, the GGC gives savers resident in Ghana an additional avenue to invest and reap the benefits from the BOG’s domestic gold purchase program.This is also due to the fact that Gold can serve as a natural hedge during periods of economic turbulence and the issuance of the GGC broadens access to this enduring financial asset, enabling investors to diversify their financial portfolios.
Furthermore, in issuing the GGC, the BOG will be able to mop up extra cedi liquidity in the banking sector and then ensure that it supplements the use of the Bank of Ghana Bills and overnight depo for open market operations.
Noteworthy features of the Ghana Gold Coin (GGC)?
Aside from its sizes and packaging, the GGC for now can only be purchased in Ghana through a commercial bank using the Ghana CediWith regards to GGC pricing, its basis will be the previous day London Bullion Marketing Association (LBMA) Auction PM Price.
Consequently, the United States Dollar against Ghana Cedi rate quoted using the previous day close Bloomberg REGN Mid-Rate will be the applicable transaction exchange rate for pricing of the GGC.
The price of the GGC will be published on the Bank of Ghana website daily by 9:00am GMT and applicable charges will apply.
Another feature of the GGC, unlike other financial products is that, a holder of a GGC can sell the coin to a commercial bank with the Bank of Ghana standing ready to buy and resell in situations where a commercial bank is not able to purchase a coin.
Security & Authenticity
According to BOG, the GGC has specific dimensions and weight, thus, weighing and measuring the coin can provide a quick indication of its authenticity.Also, any fuzziness or deviation in the design details of the coin which includes the Ghana Coat of Arms on one side and the Independence Arch on the other side, could indicate a counterfeit.
Further, the GGC cannot be attracted to a magnet since pure gold is not magnetic. This indicates that, a GGC atracted by a magnet is probably a counterfeit.
Finally, the authenticity of the GGC can be verified using Veriscan technology. This application can only be downloaded from the Apple store with plans to develop the Android version.
International Approval and Recognition
To prevent the use of GCC in illicit activities, the BOG will employ the following mechanisms:
- Route all transactions through banks where customers have been subjected to thorough Know Your Customer (KYC) and Customer Due Diligence (CDD) checks to prove sources of funds.
- Institute a framework of monitoring transactions and reporting of suspicious activities.
- Mandatory identity verification for all GGC buyers.
- Set transaction limits that when exceeded will trigger additional scrutiny.
- Screen all purchases against national and international sanctions lists.
Analysis
Investing in Gold is a popular financial strategy due to its stability and safety reputation.Take a look at the chart below:
Why is Gold Investment Profitable?
Investment in Gold is profitable as evidenced from the chart above.The underlisted reasons spell out why.
- Gold's value, unlike paper currency does not erode significantly due to inflation or economic downturns.
- Gold often acts as a hedge during periods of high inflation. What this means is that When the purchasing power of a currency declines, the price of gold typically rises, offering protection for investors' assets.
- Gold is highly liquid, meaning it can be easily bought or sold in various forms (e.g., coins, bars, ETFs) worldwide. This liquidity provides flexibility for investors needing quick access to cash.
Challenges with Gold Investment
Gold investment, notwithstanding its well documented profitability, has some notable challenges.Here are two main challenges associated with gold investment:
- Gold prices, while stable in the long term, can be volatile in the short term, affected by factors such as geopolitical events, interest rates, and currency fluctuations. This can be a barrier to investors in need of quick returns.
- Physical gold requires secure storage. This may incur additional costs for insurance and safekeeping which makes it somehow an expensive investment option.
How much do you need to invest in Ghana Gold Coin?
This post has cited information from the underlisted credible sources:
Questions and Answers on the Ghana Gold Coin
Governor’s Remarks – Launch Of Ghana Gold Coin
Comments