Bank of Ghana's $12.9 Billion FX Intervention Sparks Governance Concerns

The Bank of Ghana (BoG) has intervened heavily in the foreign exchange market, selling $12.9 billion in the past year to prop up the cedi. This massive intervention has helped stabilize the currency, which appreciated by 40.7% in nominal effective terms over the same period.

However, despite these efforts, the cedi has come under renewed pressure this year, depreciating about 10% against the dollar in the first seven months of 2026. The IMF has flagged a governance concern with how the intervention was carried out, citing instances where auctions deviated from published guidelines.

The central bank's Domestic Gold Purchase Programme, which aims to rebuild external buffers through gold purchases, has generated losses of GHS 22 billion (1.5% of GDP) in 2025. The IMF has cautioned against accumulating large reserves, noting that sterilisation costs would rise with further accumulation.

The Bank of Ghana has begun reshaping its reserves, cutting the share of monetary gold and selling half of its gold holdings to improve the portfolio's risk profile. The IMF recommends that the central bank gradually reduce its footprint in the FX market and relax net open position limits to deepen the interbank market.