Bank of Ghana Invests $10bn to Stabilize Cedi
The Bank of Ghana (BoG) has injected approximately $10 billion into the foreign exchange market since January 2025, a move that has significantly contributed to the cedi’s stability.
This substantial amount was sold to commercial banks and businesses to meet their dollar demands, spanning from January to the first week of December 2025. BoG officials describe the action as a “dollar intervention” aimed at addressing market needs.
According to sources at the Bank of Ghana, the intervention isn’t solely focused on defending the cedi, but rather a broader strategy to satisfy the overall demand for US dollars in the economy.
The funding for this support has come from the BoG’s Domestic Gold Purchase Programme, which has benefited from increased global gold prices. The proceeds from these gold sales have been strategically used through dollar auctions to bolster the market.
Crucially, the Central Bank has managed this intervention without depleting its foreign reserves. Officials have emphasized that the support is structured to ensure Ghana continues to meet its debt obligations and build up its reserves.
A portion of the windfall from gold sales has been allocated to reserve accumulation, upcoming debt repayments, and providing dollar liquidity to the market. Data indicates a positive trend in reserve levels.
In December 2024, Ghana’s international reserves stood at $9.1 billion. By October 2025, this figure had risen to $11.4 billion, with projections indicating it could exceed $12 billion by year-end.
“This demonstrates that the interventions have been carefully managed and haven’t compromised the country’s reserve position,” a market analyst told Joy Business.
In October alone, the Bank of Ghana injected $1.15 billion into the market through the FX Intermediation Programme, conducting the dollar auction on a market-neutral, spot basis.
Market observers believe these interventions played a key role in the cedi’s record appreciation in October 2025. Data from the Bank of Ghana confirms this, showing a 13.9% appreciation against the dollar by the end of October and a 32.2% year-to-date increase.
To further clarify its approach, the Bank of Ghana announced a new Foreign Exchange Operations (FX) Framework in November. The regulator stated the framework reinforces its commitment to macroeconomic stability within an inflation-targeting regime and a flexible, market-driven exchange rate system.
The framework outlines three core objectives: supporting reserve accumulation, reducing excessive short-term volatility, and intermediating FX flows in a market-neutral manner, utilizing proceeds from the Gold Purchase Programme or export surrender requirements.
This means the BoG will manage forex inflows in a transparent and orderly way, without attempting to manipulate the exchange rate. Future interventions will follow a “structured discretion-under-constraint” approach.
According to the Bank, this approach ensures interventions address market failures, such as the lack of hedging tools, rather than targeting specific exchange rate levels. “Reserve accumulation and intermediation objectives will be achieved through transparent and well-communicated operations,” the Bank of Ghana stated.
Image Source: MYJOYONLINE
