The Bank of Ghana (BoG) has scaled back its foreign exchange intermediation efforts, planning to sell up to US$800 million in December, down from previous months.
This decision follows a period of significant intervention, with the central bank injecting an estimated US$10 billion into the market between January and November 2025 to stabilize the cedi.
The BoG’s has attributed the decision to reduced FX demand during the festive season, when market activity typically slows down. The central bank has already auctioned US$100 million on December 2 and another US$100 million on December 4, with plans for twice-weekly auctions open to licensed banks. However, this has raised concerns among market players, with some warning that it could lead to cedi volatility.
Oil market players call for intervention
“We need the Bank of Ghana to intervene to stabilize the forex market,” said Duncan Amoah, Executive Secretary of the Chamber of Petroleum Consumers (COPEC). “The swoop on black market forex dealers has had a very dire impact, triggering sharp rate jumps within hours.”
The cedi has appreciated 31% year-to-date against the dollar, trading at GH¢11.42 to the dollar as of December 10, 2025. However, the recent crackdown on black market dealers has led to a surge in rates, with the dollar selling at around GH¢12.30 on the open market.
Amoah warned that if the BoG doesn’t intervene, the situation could worsen, pushing fuel prices up. “The fuels market will respond immediately,” he said. “Ghana’s petroleum market needs about US$400 million, and if the open market behaves the way it is doing, they may not be able to hold prices further.”
The BoG’s new Foreign Exchange Operations Framework aims to support reserve accumulation, reduce excessive short-term volatility, and intermediate FX flows in a market-neutral manner. However, market players are urging the central bank to take swift action to address the current volatility.
“The managers of the economy have done a tremendous job, but there’s a danger if they don’t intervene properly,” Amoah said. “The situation is not desirable, and authorities need to assess the full impact of the arrests.”
New FX Framework
In November, the Bank of Ghana announced that its Board had approved a new Foreign Exchange Operations Framework to clarify the objectives and principles guiding its FX operations.
According to the regulator, the framework reinforces its commitment to macroeconomic stability under the inflation-targeting regime and a flexible, market-driven exchange rate system.
The framework is expected to deliver three core objectives:
– Support reserve accumulation to provide a buffer against external vulnerabilities.
– Reduce excessive short-term volatility in the FX market by addressing disorderly conditions without undermining exchange-rate flexibility.
– Intermediate FX flows in a market-neutral manner, using inflows from the Gold Purchase Programme or export surrender requirements.
This means the Bank of Ghana will channel FX inflows into the market in an orderly, transparent, and non-directional manner.
The Bank says future interventions will follow a “structured discretion-under-constraint” approach. This ensures interventions do not target specific exchange-rate levels but instead address market failures, including the absence of hedging tools.
“Reserve accumulation and intermediation objectives will be achieved through transparent and well-communicated operations,” the Bank noted in its recent statement.
Seasonal trade mount pressure on Cedi
Apparently, seasonal demand for foreign exchange is once again putting pressure on the Ghanaian cedi as import-dependent businesses move to secure dollars, pounds and euros ahead of the peak Christmas trading period.
The annual surge in fourth-quarter demand has intensified competition for limited forex supply, unsettling traders who rely on predictable access to foreign currency to restock goods for the festive season.
As at last week, the impact is already visible across the market. While the interbank rate quotes the dollar at GH¢11.43, the pound at GH¢15.21 and the euro at GH¢13.28, retail pricing tells a markedly different story.
At forex bureaus, the dollar was selling at around GH¢12.30, with the pound and euro trading at GH¢16.40 and GH¢14.40 respectively.
The widening spread between official and retail rates has become a key signal of tightening conditions, reflecting growing competition among importers and increasing pressure on dealers struggling to meet demand.
The central bank maintains that it is closely monitoring liquidity pressures and stands ready to deploy additional monetary policy tools to contain volatility as the festive season approaches. But the coming weeks will be crucial because the balance between seasonal demand and policy response is likely to determine how the cedi ends the year.
By Adnan Adams Mohammed
