Ghana faces economic volatility as cedi weakens and reserves decline

Ghana’s economic stability is facing new challenges in 2026 as the cedi depreciates and foreign reserves decline. Despite a period of stabilization in 2025 characterized by falling inflation and increased reserves, recent data from the Bank of Ghana indicates a more volatile external-sector environment.

By September, the cedi had depreciated by 9.5 percent in real bilateral terms against the US dollar year-to-date. Simultaneously, gross international reserves have dropped from 5.7 months of import cover at the start of the year to 4.2 months by August, representing a total loss of $3.09 billion.

This volatility occurs despite significant market interventions totaling over $12 billion in foreign exchange. Much of Ghana’s external position relies on the Domestic Gold Purchase Programme (DGPP), a policy where the state purchases gold from domestic producers in cedis to bolster reserves. While the IMF noted that the DGPP facilitated $10.9 billion in artisanal gold exports in 2025, the current rapid depreciation and reserve decline raise questions regarding the country's continued dependence on gold-derived foreign exchange.