Pumping Dollars into the Market to Artificially Prop Up the Cedi is a Temporary Cosmetic Fix — Domfe

According to an Official Facebook Post by George Domfe on November 9, 2026, the economic commentator has questioned the celebration surrounding the NDC government’s economic performance, arguing that the appreciation of the Ghanaian cedi should not automatically be interpreted as evidence of exceptional economic management. In a post titled around the argument that “Pumping dollars into the market to artificially prop up the cedi and create an illusion of economic stability is hardly an ingenious economic strategy,” Domfe described the approach as a temporary cosmetic intervention rather than a sustainable solution to Ghana’s economic challenges.

Domfe’s central concern is that the apparent stability of the cedi may depend heavily on the availability of foreign exchange from external sources, particularly gold-related inflows and other sources of foreign currency. He questioned what would happen if international gold prices declined or external inflows weakened, warning that an economy relying heavily on such support could face renewed currency pressure when those favourable conditions change.

His criticism also challenges the tendency to measure economic success primarily through the performance of the exchange rate. Although a stronger cedi can provide relief by reducing the domestic cost of imported goods, easing foreign debt obligations and helping to moderate imported inflation, Domfe believes that these benefits should not distract from the more fundamental question of whether the economy is creating sustainable opportunities for ordinary Ghanaians.

The debate is particularly relevant because Ghana’s currency recorded a significant recovery in 2025. The Bank of Ghana’s 2025 Annual Report indicates that the cedi appreciated by 40.7 per cent against the US dollar during the year, reversing a substantial depreciation recorded in 2024. The report attributed the turnaround to a combination of tight monetary policy, fiscal consolidation and improved external sector performance, including stronger export receipts. Gold receipts, in particular, benefited from higher prices and increased export earnings.

However, the Bank of Ghana has disputed the suggestion that the cedi’s appreciation was simply the result of artificial dollar injections. In its May 2026 explanation, the central bank maintained that the appreciation was largely market-driven and supported by improved macroeconomic fundamentals, stronger external buffers, fiscal consolidation and an appropriate monetary policy stance. It also explained that much of its role involved channeling foreign exchange liquidity into the market through competitive auctions, rather than relying on discretionary interventions.

Nevertheless, the question of sustainability raised by Domfe has a basis in the risks identified by international financial institutions. An IMF assessment published in 2026 highlighted Ghana’s increasing dependence on gold-related export earnings and warned that a sharp decline in international gold prices could reduce foreign exchange inflows, weaken the cedi and affect reserve adequacy. The IMF also identified the need to strengthen economic diversification and reduce exposure to commodity-price fluctuations.

Beyond currency stability, Domfe’s comments bring attention to employment creation and the productive capacity of the economy. A stronger exchange rate may improve purchasing power and reduce some business costs, but it does not automatically create factories, expand agricultural production, increase manufacturing output or provide enough sustainable jobs for the growing population. Those outcomes require investment, productivity improvements, reliable infrastructure and policies that support businesses and expand productive sectors.

Ultimately, Domfe is challenging the government and its supporters to look beyond favourable exchange-rate figures and demonstrate that the economic recovery is producing lasting improvements in people’s lives. His warning is that a recovery dependent on favourable external conditions could become vulnerable when those conditions change.

The bigger question, therefore, is not simply how strong the cedi can become today, but whether Ghana is building an economy capable of sustaining that strength tomorrow, even when gold prices fall and external inflows become less favourable.

Source: Official Facebook Post by George Domfe – November 9, 2026.

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