BoG to inject $1.15bn into forex market to stabilise cedi

The Bank of Ghana (BoG) has announced a major foreign exchange (FX) intervention programme aimed at strengthening the local currency and deepening Ghana’s forex market liquidity. Beginning in October 2025, the central bank will commence FX intermediation under its Domestic Gold Purchase Programme, with plans to inject up to US$1.15 billion into the forex market by the end of the month.

According to the BoG, the sales will be conducted on a spot basis through twice-weekly, price-competitive auctions open to all licensed commercial banks operating in the country. The initiative forms part of the central bank’s broader strategy to stabilise the cedi, ensure market transparency, and improve the process of price discovery within the forex ecosystem.

Speaking at a meeting with managing directors and treasurers of commercial banks in Accra, Dr. Johnson Asiama, Governor of the Bank of Ghana, emphasized that there will be no special conditions or preferential access for any institution. He stated that all qualified participants will compete on equal terms through the auction platform, ensuring fairness and accountability in the allocation of foreign currency.

“Beginning October 2025, the Bank of Ghana will commence foreign exchange (FX) intermediation under the Domestic Gold Purchase Programme, with plans to sell up to US$1.15 billion for the month. These sales will be conducted on a spot basis through twice-weekly, price-competitive auctions open to all licensed banks,” Dr. Asiama reiterated.

The primary goal of the programme is to stabilise the Ghanaian cedi, which has experienced depreciation pressures in recent months due to high import demand, seasonal liquidity cycles, and global monetary tightening. By supplying more forex liquidity to the market, the BoG hopes to reduce volatility and discourage speculative trading practices that often intensify exchange rate fluctuations.

The Bank noted that monthly auction volumes may be adjusted depending on market conditions, external reserve levels, and seasonal inflows. However, the overarching objective remains to create a transparent, efficient, and predictable forex market that supports long-term macroeconomic stability.

In addition to the FX auction strategy, Dr. Asiama highlighted the importance of complementing monetary policy with real sector reforms. He urged commercial banks to channel more credit towards small and medium-sized enterprises (SMEs), agribusinesses, and local manufacturers, which he described as the “productive engines” of the Ghanaian economy. He also encouraged banks to strengthen their partnerships with exporters to expand Ghana’s foreign exchange earnings.

The BoG further advised financial institutions to:

• Develop innovative, export-oriented financial products that enhance competitiveness and support value addition.

• Utilize local insurance companies for import and trade coverage to reduce capital flight and retain foreign exchange reserves within Ghana.

• Consider public listings on the Ghana Stock Exchange to broaden ownership, deepen market transparency, and strengthen capital buffers.

The Domestic Gold Purchase Programme (DGPP), under which the FX intervention is being implemented, was established to leverage Ghana’s gold production as a tool for reserve accumulation. By purchasing locally mined gold with cedis and using it as a reserve asset, the BoG reduces its dependency on foreign currency holdings while enhancing the country’s external resilience.

Economists have lauded the initiative as a proactive measure to address short-term liquidity challenges and to align Ghana’s monetary policy with sustainable resource-backed strategies. They, however, caution that the effectiveness of the programme will depend on disciplined implementation, consistent monitoring of market behavior, and strong coordination with fiscal authorities.

The BoG has assured the public that it will continue to monitor the exchange rate closely, respond swiftly to emerging pressures, and communicate policy decisions transparently. The central bank reaffirmed its commitment to a stable and resilient financial system, noting that a strong cedi is critical to sustaining investor confidence, reducing inflationary pressures, and fostering economic recovery.

The intervention marks one of the largest single-month forex support packages in Ghana’s recent monetary history, signalling the BoG’s determination to safeguard macroeconomic stability and restore public confidence in the national currency.