The anticipated $360 million disbursement from the International Monetary Fund (IMF) is set to provide a critical boost to Ghana’s foreign exchange reserves, reinforcing supply-side measures to stabilise the Ghana cedi.
This injection is expected to strengthen the local currency’s performance in the short term.
Last week, the Ghana cedi benefited from improved foreign exchange liquidity.
The Bank of Ghana (BoG) sold approximately $93.05 million in daily forex auctions and an additional $20 million to Bulk Oil Distributing Companies.
This increased liquidity led to a 1.85% week-on-week appreciation of the cedi against the dollar.
The currency also gained 1.35% against the pound and 1.17% against the euro.
As of the close of business day, December 2, one dollar was equivalent to GH¢15.20. Despite these gains, the Cedi’s year-to-date depreciation remains at 25.08%.
— Bank of Ghana (@thebankofghana) December 3, 2024
Tue 3 Dec, 2024 • 10:00 AM
💵 1 USD = ₵15.76 🔽
💷 1 GBP = ₵19.99 🔽
💶 1 EUR = ₵16.63 🔽Find bank & forex bureau rates in this thread! 🧵
— CediRates (@CediRates) December 3, 2024
Ghana’s foreign exchange reserves rose to $5.2 billion in October 2024, a modest 0.77% month-on-month increase compared to the 1.95% growth seen in September.
Analysts attribute the slower growth to the Bank of Ghana’s $376.3 million injection into the market in October, which supported the cedi but highlighted potential risks.
Experts caution that sustained interventions by the Bank of Ghana could strain the country’s foreign exchange reserves, making it challenging to maintain a robust buffer in the coming months.