The Bank of Ghana is progressing with reforms to its liquidity management framework, according to the International Monetary Fund (IMF) staff team. The reforms aim to regulate the amount of cedi liquidity in the banking system.
The IMF team, led by Mr Ruben Atoyan, observed this during the first review of Ghana's 36-month Policy Coordination Instrument (PCI).
The liquidity management framework enables the Central Bank to absorb excess cash to curb inflation or inject funds to prevent shortages and sharp increases in interest rates. The Bank has pledged to introduce a seven-day bill as its main instrument for short-term liquidity management.
It will also provide banks with unrestricted end-of-day access to its lending and deposit facilities to stabilise overnight interest rates.
The reforms are part of Ghana's structural reforms, including the rollout of the Integrated Tax Administration System and the operationalisation of the Fiscal Council. The IMF team said completing the remaining reforms on schedule would support Ghana's macroeconomic stability and help translate economic gains into jobs and prosperity.
The reforms were carried over from the Extended Credit Facility (ECF) programme approved in May 2023.
Dr Johnson Pandit Asiama, Governor of the Bank of Ghana, said the transition from the 56-day bill to the 14-day bill had made liquidity management more responsive and flexible. The shorter maturity period allows for more frequent assessment and adjustment of liquidity, enabling the Bank to respond more effectively to changing market conditions.
Mr Bright Simons, Vice President of IMANI Centre for Policy and Education, acknowledged the results delivered by the liquidity management framework, citing the decline in inflation to 5.4 per cent and the cedi's 40.7 per cent appreciation against the US dollar.
The Bank of Ghana's audited 2025 financial statements showed a decline in inflation and an increase in gross international reserves to US$11.9 billion. However, Mr Simons cautioned that the operating model underpinning the gains was financially unsustainable, leaving the Central Bank with limited capacity to withstand future economic shocks.
The IMF team's observation and the Bank's reforms aim to address these challenges and support Ghana's economic growth.