The medium-term outlook of the Ghana cedi hinges on continued reserves accumulation and post-IMF fiscal discipline.

This is on the back of a board approval of a new foreign exchange (FX) operations framework with the ultimate objective to enhance market transparency, investor confidence, and macroeconomic stability.

According to the financial and market research firm, IC Research, it expects the predictable, transparent and market-neutral approach to FX operations by the Bank of Ghana to anchor market sentiment and reduce intraday volatility similar to the transparency-induced benefits of inflation targeting.

“This should sustain the near-term stability of the Ghanaian Cedi, and we reiterate our view for the exchange rate to remain anchored below the GH¢12.0/US dollar mark in the near-term, possibly into late-2026. However, the medium-term effectiveness of this framework will be tested by flows from gold-for-reserves and export surrenders, which have implications for reserve accumulation, especially as Ghana begins the era of elevated external debt service from 2026,” it mentioned.

The new FX operation framework codifies the Bank of Ghana's discretion under a constrained intervention approach.

Its model will pursue three important targets:

1. Reserve build-up to provide a buffer against external shocks
2.  Volatility smoothening to reduce excessive short-term swings without undermining exchange rate flexibility and
3.  Market-neutral flow intermediations as BOG repositions itself as a disciplined market participant rather than a price-setter.

“We believe this is akin to the Inflation Targeting Framework, which the monetary authorities have relied upon since 2007 to reduce the swings in the inflation rate and anchor inflation expectations. We believe the BoG's ‘discretion under constraint’ approach to its FX market operation preserves flexibility of market interventions while institutionalising market discipline. We view this as a particularly crucial policy anchor as Ghana approaches the end of its IMF programme in 2026, when market perception of policy credibility will significantly influence the exchange rate trend”, IC Securities mentioned.

Overall, it concluded that the Bank of Ghana’s new FX operation framework strengthens institutional credibility and signals a policy shift from reactive ad hoc FX supports toward a predictable, rules-based FX governance model.