Ghana, Tanzania, and Uganda face heightened vulnerability to foreign exchange reserve instability if gold prices decline sharply, according to a new Fitch Solutions’ BMI analysis.
These countries rely heavily on bullion for export revenue 45%, 42%, and 35% respectively leaving their currencies exposed to commodity market fluctuations.
BMI Senior Analyst Orson Gard warned a gold slump could deflate reserve values, reduce foreign currency inflows, and strain non-gold reserves, particularly affecting external solvency.
The risk compounds existing liquidity challenges, as African central banks may struggle to convert gold into liquid assets like foreign exchange during crises.
While BMI maintains a 2025 base gold price forecast of $3,100 per ounce, Senior Commodities Analyst Olga Savina noted the metal’s recent rally has likely peaked despite prices surging 26% this year to $3,298.54. Central bank purchases, driven by efforts to diversify from U.S. assets amid global trade tensions, contributed to the rise.
The World Gold Council confirms continued central bank buying plans over the next year, involving Burkina Faso, South Africa, Nigeria, Rwanda, and Kenya. Gard emphasized that gold-dependent economies require strategic buffers to mitigate price shocks, noting: “Reliance on export receipts for solvency intensifies these risks.”