The cedi and Ghana’s Eurobonds appreciated on May 15, 2023, following news that the IMF Board would approve a US$3 billion programme to support the country’s balance of payment this week.
Bloomberg reported that the cedi gained 5.3% on May 15, 2023, , its biggest increase since April 3, 2023. Analysts had predicted that the cedi would strengthen once Ghana secured the IMF-support programme. The cedi had recovered from a 22% depreciation against the US dollar in the first two months of 2023 to a stable value since March 2023.
The IMF programme would also unlock financing from other development partners, such as the World Bank and the African Development Bank. The government was in talks with the World Bank for a US$250 million facility and the AfDB for another US$100 million facility to establish a Financial Sector Stability Fund. The fund would help banks that were affected by the Domestic Debt Exchange Programme (DDEP), which saw government swap GH¢82 billion of old bonds for 12 new ones at a lower interest rate. The DDEP had caused 16 out of 23 banks in Ghana to record losses in 2022.
The government was also in discussions with the World Bank for a three-year development policy budget support programme of US$900 million, which would complement the IMF programme. Dr. Mohammed Amin Adam, Minister of State at the Finance Ministry, said that the approval of the IMF programme would boost investor confidence in Ghana and enable the country to return to the international capital market soon.