Ghana had one of its best currency performances in recent memory between January and October of 2025. The value of the cedi increased significantly in relation to the US dollar, rising from GH¢15.30 in January to GH¢10.28 in May before leveling off at GH¢12.42 in September. A crucial question was brought up by the quick appreciation: where did the foreign exchange come from?
The central bank’s extensive foreign exchange (FX) intervention, which is projected to cost roughly US$10 billion over the course of the period, is the solution.
When the central bank injects foreign currency into the domestic market to meet import demand, stabilize the exchange rate, reduce volatility, and boost confidence, this is known as an FX intervention. Economists use a straightforward accounting identity to monitor this: FX inflows less the shift in foreign reserves equals FX intervention. The difference must have been sold into the market if a nation makes a lot of foreign exchange, but its reserves only slightly increase.
Ghana’s Gross International Reserves rose from US$9.11 billion in December 2024 to US$11.41 billion by October 2025, according to the data. Over a ten-month period, this amounts to a net increase of only US$2.30 billion.
Nonetheless, Ghana made a sizable amount of foreign exchange during that time. With US$15.25 billion in gold exports, US$2.82 billion in cocoa exports, US$2.20 billion in oil exports, and US$3.06 billion in other exports, total exports came to US$23.33 billion. Furthermore, net financial inflows, excluding reserves, were roughly US$1.92 billion, while private transfers and remittances totaled about US$6.5 billion.
Between January and October of 2025, Ghana received foreign exchange inflows totaling approximately US$31.75 billion.
The nation had to pay for imports out of this sum. US$4.40 billion in oil imports and US$10.40 billion in non-oil imports made up the total imports of US$14.80 billion during that time. Ghana had a net foreign exchange surplus of US$16.95 billion after paying for imports.
There are only two possible outcomes for this excess: either it would be sold into the foreign exchange market, or it would be added to foreign reserves. The remaining US$14.65 billion must have been supplied to the market because reserves only increased by US$2.30 billion.
After adjusting for standard reserve accounting factors such as encumbered assets, gold revaluation gains, petroleum and heritage funds, and FX holdings outside the intervention pool, analysts apply a conservative 30–35% adjustment. Using a 32% adjustment, the estimated FX sold into the market comes to US$9.96 billion, which rounds to approximately US$10 billion.
Exchange rate movements confirm this conclusion. A 33–43% appreciation of the cedi within a few months cannot occur with weak portfolio inflows, without capital account liberalization, or without a very large supply of foreign currency. The data therefore points clearly to deliberate FX intervention, not a spontaneous market-driven outcome.
In simple terms, Ghana earned a lot of foreign exchange in 2025, but instead of saving most of it, the authorities used nearly US$10 billion to stabilize the cedi, reduce pressure on importers, and calm the FX market. The strategy worked in the short term, but it also highlights the scale of resources required to defend the currency.
Author:
Prof. Isaac Boadi
Dean, Faculty of Accounting and Finance, UPSA
Executive Director, Institute of Economic and Research Policy, IERPP
