GOLD KEEPS PNG’S FX MARKET AFLOAT AS COCOA PRICES DROP BY 46%

Picture Caption: BSP Group General Manager for Treasury and Markets, Rohan George

PAPUA New Guinea’s foreign exchange market is riding on the strength of its mining exports, with gold helping to steady the Kina amid weakening agricultural inflows.

According to BSP Financial Group’s September Quarter Economic and Market Update, total FX market turnover reached K16.2 billion in the third quarter of 2025 that’s a 9% increase from the same time last year.

But BSP Group General Manager for Treasury and Markets, Rohan George says the growth covers a shifting export landscape.

“FX inflows from the agricultural sector are expected to soften, reflecting the delayed impact of recent commodity price declines for instance, cocoa prices have fallen by 46 percent,” he said.

Despite the drop in agricultural earnings, BSP notes that mining exports, particularly gold, continue to generate solid inflows, helping to cushion the economy against market shocks.

Mr. George said BSP is encouraging clients to plan and submit FX orders early, as fluctuating inflows continue to pressure liquidity and extend processing times.

Economists say PNG’s FX performance underlines how commodity price swings directly influence the local currency, with gold now playing a stabilizing role amid global uncertainty.

While the Bank of Papua New Guinea remains cautious in its interventions, BSP expects the FX market to stay active but uneven in the months ahead depending largely on how long gold can keep PNG’s foreign exchange engine running.