A decline in external buffers and expected fiscal spending complicate the foreign exchange outlook, IC Insights has revealed.

According to the firm, the weaker foreign exchange reserves highlight Ghana’s external vulnerabilities, with the rebuilding of reserves targeted as a key priority in the months ahead.

“We note that the FX [foreign exchange] reserve buffer remains below the 5.7-months cover attained in March 2026 and the 4.6-months cover in August 2025 amid the higher import prices and rising seasonal import demand. The Committee’s call to rebuild reserves as a key priority in the coming months raises two possibilities in our view. (1) intensify GOLDBOD exports and/or (2) accommodate a slightly more depreciation of the Cedi”, it stated in an article “Ghana MPC Update: A Narrowing Policy Space”.

“We think the former will be a priority while the USDGHS [US dollar/Ghana cedi] continues to adjust in line with inflation momentum and will likely drift faster if the projected current account deficit in 3Q2026 [quarter 3 2026] materialises.

IC Insights continued that the fiscal operations in seven months of 2026 reflected a tight grip on public spending amid improving but still lagging revenue outturn.

“This puts the fiscal balance in a strongly better position than targeted for the period and raises expectation of higher spending in 4Q2026 [fourth quarter of 2026] in line with the 2026 budget framework. This will likely elevate Cedi liquidity, aggregate demand, with moderate pressure on the Ghanaian Cedi especially with US$ 1.13 billion required for Eurobond service in 2027”.

Iin January 2027, Ghana will have to repay US$570 million in Eurobond.

The Ghana cedi was the worst currency in Africa, depreciating nearly 10% against the US dollar between March 2026 and June 2026, the World Bank revealed in its October 2026 Africa Economic Update.

Meanwhile, the local currency remained under pressure over the last two weeks, extending its year-to-date depreciation against the US dollar to 10.04%.