The Bank of Ghana (BoG) has reduced both the scale and frequency of its interventions in the foreign exchange (forex) market following concerns raised by the International Monetary Fund (IMF) over heavy market activity earlier this year.

During the second quarter of 2025, the central bank injected more than US$2.0 billion into the forex market, a move the IMF described as unsustainable, urging caution to safeguard reserves and ensure stability.

By the end of July 2025, the BoG’s forex forward sales had dropped to US$822.8 million, representing a 53.6% decline compared to June 2025.

Notably, the bank stayed out of the market on July 25 and 29, marking its first absence since April.

This tighter forex supply contributed to a 1.7% depreciation of the cedi against the US dollar after the IMF Board’s approval of Ghana’s latest programme review.

According to IC Research, a leading economic and financial analysis firm, the reduction in interventions is aimed at avoiding a prolonged overvaluation of the exchange rate and closing arbitrage gaps.

The firm projects that the cedi could depreciate gradually, with the interbank rate expected to settle between GH¢10.45 and GH¢11.45 per US dollar (midpoint: GH¢10.95/USD) by the end of 2025.

IC Research further noted that the Real Effective Exchange Rate (REER) appreciation signals a likely corrective depreciation ahead, though modest.

The sharp cedi appreciation in the first half of 2025 created multiple forex rates, with the interbank rate at mid-GH¢10/USD while the retail market traded closer to GH¢12/USD.

“Our analysis of Ghana’s FX trend suggests a sharp appreciation of the real exchange rate,” the report stated, highlighting a 31.3% decline in the REER index within six months to 92.7 points by June 2025.

The appreciation, which began in April 2025, intensified through June, reflecting movements in the nominal bilateral forex market